Financing arranged to advance Farim deposit to production
Champion Resources Inc CHL
Shares issued 16,746,940 Dec 8 close $0.32
Thu 10 Dec 98 News Release
Mr. Michael McInnis reports
Champion's wholly-owned subsidiary, Champion Industrial Minerals Inc., has
agreed to the terms of a $84,000,000 (U.S.) non-recourse loan to advance
the Farim phosphate deposit in Guinea-Bissau, West Africa to production.
The proposed financing will be sufficient to cover 100 per cent of the
estimated capital costs to place the deposit into production.
It is intended that the proposed financing of the transaction will be under
the general terms and conditions of the South African Export Credit Scheme
(SAECS). SAECS is a government sponsored program whereby the government
provides project loan guarantees as long as a minimum of 70 per cent of the
goods and services for the project are sourced out of South Africa.
The general terms of the proposed financing would be: 85 per cent of the
loan is insured under the export credit scheme and is funded at a fixed
concessionary rate of finance for the term currently quoted at 6.25 per
cent. The balance of 15 per cent would be placed with private market
insurers and will be financed by the lender at a commercial floating rate
of interest.
The finance is subject to formal approval by CGIC, the South African
Reserve Bank, the South African Lender, satisfactory technical due
diligence by the lender, and off-take contracts acceptable to the lender.
The company is targeting conditional approval by the end of the first
quarter of 1999 with technical due diligence work and the negotiation of
off-take contracts to be completed by May 1999.
The finance is being arranged through Triennex (Pty) Limited of South
Africa.
Champion will commence a program in January 1999 to satisfy the technical
due diligence requirements of the loan. The program will consist of
drilling, beneficiation work, hydrologic evaluation and product-transport
studies.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com
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