Tiger Resources (ASX:TGS) has been assigned a ‘B-’ credit rating from Standard and Poor’s and a provisional ‘B2’ credit rating from Moody’s Investor Services with both agencies citing a stable outlook.
The first time assignment of credit ratings is a milestone as the company progresses its strategy to restructure its existing facilities.
It is advancing a number of alternative competitive financing sources with the aim of securing a strong balance sheet platform from which it can realise the full value of the Kipoi project.
In October, Tiger moved to 100% ownership of the Kipoi Copper Project in the Democratic Republic of Congo.
This elevates the company to become the fourth largest attributable copper producer on the ASX and the largest copper cathode producer.
A 2.5% gross turnover royalty will be retained by the vendor Gécamines, and Tiger also intends to cede a 5% interest in Société d’Exploitation de Kipoi SA to the DRC Government to bring the mining title into alignment with mining law and regulations in the DRC.
Tiger has also maintained that it will achieve its 2014 production guidance of 14,000 tonnes copper cathode.
The company had $71 million in cash and deposits at call as at 30 September 2014.
The respective ratings levels from Standard and Poor’s and Moody’s reflects both Kipoi’s low cost position in the copper industry and the project’s domicile in the Democratic Republic of Congo.
Standard and Poor’s has assigned a B-/stable rating to the DRC while Moody’s has assigned a B3/stable rating.
The ability to obtain a credit rating is one of the key tangible benefits that the recent consolidation of the Kipoi Joint Venture provides to Tiger’s shareholders.
A rating may not have been possible under the previous structure.
This highlights the broader range of financing solutions which Tiger is able to pursue under the revised ownership structure.
In September, its solvent extraction electro-winning (SXEW) plant at Kipoi reached and sustained its annual nameplate production rate of 25,000 tonnes of copper cathode in September.
The plant produced 5,620 tonnes of copper cathode during the September quarter at C1 costs of US$1.56 per pound, includes a non-cash mining cost of $0.34/lb.
Stacked ore grades averaged 2.31% copper, reflecting the lower average grade of the HMS floats material initially sourced and stacked on the heap leach early in the quarter.
Over the first 12 months of SXEW operation the stacked grades are expected to average 3%, being the average reserve grade of the HMS floats stockpile scheduled as ore feed to the SXEW heap leach operations.
Recovery performance of the 2 heaps has been within expectations despite the ore stacked onto pad 1 being only 50% agglomerated, whilst pad 2 was 100% agglomerated.
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