From: Biniam Haile \(SWE\) (email@example.com)
Date: Wed Jan 07 2009 - 18:40:35 EST
Nevsun expects to have $200m-plus debt finance in place by end-March
By: Liezel Hill
Published on 7th January 2009
TORONTO (miningweekly.com) - Canada-based Nevsun Resources, which is
building the Bisha gold mine, in Eritrea, hopes to finalise more than
$200-million in debt finance for the project by the end of the first
The firm is finalising legal and due diligence arrangements with a group
of development agencies and commercial banks from Europe and South
Africa, which will provide a mix of senior and subordinated debt, the
company said on Wednesday.
Nevsun said in October that it had received a commitment for some
$89-million from South Africa's Industrial Development Corporation,
which will serve as lead banker for the project.
Of the $250-million budgeted for the mine's construction, about
$40-million had been spent by the December 31, and the company ended the
year with a cash position of around $40-million.
The Bisha project, which is expected to start production in mid-2010,
will produce an average of 431 000 oz/y of gold and 702 000 oz/y of
silver in the first two years of production.
Copper and zinc output will begin in years three and six respectively.
To date, Nevsun and the State-owned Eritrean National Mining Corporation
have funded all the work on the mine themselves.
The project detailed design work is almost complete, and most equipment
and materials have been ordered with terms secured.
The mills for the plant are being fabricated in Europe and are scheduled
for delivery to site in the fourth quarter of this year, the company
Nevsun was ordered by the Eritrean government to halt exploration at
Bisha in 2004 and then allowed to resume operations in the country in
early 2005, after agreeing to allow the government to buy a 30% interest
in the project, on top of the free 10% interest it receives according to
the country's law.
Editor: Liezel Hill
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