Metro Mining (ASX:MMI) has received its final required environmental approval from the Commonwealth government for its Bauxite Hills Mine located in northern Queensland.
Completion of the comprehensive environmental approval process within only 2 years is a testament to the company.
Post receipt of final environment approval Metro is now advancing board approval for full project development of the Bauxite Hills Mine.
Based on the bankable feasibility study completed in March 2017, the planned production from the Bauxite Hill Mine is 2 million tonnes per annum increasing to 6 million tonnes per annum over the first four years.
The environmental approvals in place allow production of up to 10 million tonnes per annum.
Construction is due to commence next month and first production is on schedule for Q2 2018.
Simon Finnis, managing director, commented
“We are delighted to have secured the final environmental approval for the Bauxite Hills Mine.
“It is the culmination of an extensive environmental assessment and community consultation process and it allows Metro to continue to rapidly progress its mine development and construction plans.
“Achieving this milestone within only 2 years is a credit to the hard work and expertise of the Metro team and demonstrates the strong support Metro has secured from all levels of local, state and federal government stakeholders.”
Recent debt financing
Last week, Metro secured debt financing for the development of its flagship Bauxite Hills Mine.
Binding terms were agreed with the two entities, Sprott Private Resource Lending and Ingatatus AG Pty Ltd, a related party of Metro’s strategic cornerstone shareholder, Balanced Property.
The key terms of the debt financing are:
- Tenor of circa 3 years;
- Attractive annual interest rate;
- No principal amortisation before January 2019 and A$20 million payment at end of loan;
- No commitment fees;
- No hedging requirements;
- Low level of cash reserving and no mandatory cash sweep; and
- Low number of Metro options with strike price to reflect 25% premium to Metro share price.
The debt financing is being led by Sprott who is the senior secured lender.
The new debt facilities will also replace Metro’s existing A$15 million short term debt facility.
Completion of final debt financing agreements remains conditional upon documentation, legal due diligence, permitting and other conditions precedent usual for financings of this nature including project equity requirements being raised prior to debt drawdown.
Subject to satisfaction of these remaining conditions, Metro expects final agreements to be concluded early in September quarter 2017.