Metro Mining Limited (ASX:MMI) has received a loan offer from the Northern Australia Infrastructure Facility (NAIF) for its Bauxite Hills Mine Stage 2 expansion to 6 million wet metric tonnes (WMT) per annum.
The NAIF Board has made an Investment Decision to offer a long-term (9 years) loan facility of up to $47.5 Million.
The funds will be used for the construction and mobilisation of a floating terminal at Skardon River.
It is worth noting that the floating terminal is the main component of Stage 2 comprising around 85% of the total estimated capital costs.
Stage 2 DFS complete and financing secured
Metro Mining managing director and chief executive officer Simon Finnis said: “We are very pleased to have secured the support of NAIF in providing a long-term loan to provide financing for the Stage 2 Expansion.
“Bauxite Hills will be a significant contributor to the economy of Northern Australia and a large employer from the surrounding communities for many years to come.
“I would like to personally thank the NAIF team for their time and commitment during the due diligence process in order to understand the Project, the global bauxite market and its importance to Northern Australia.
“With the Stage 2 DFS complete and financing secured, we are now awaiting completion of the final design of the Floating Terminal in order to be in a position to present to the Board for final approval”.
Critical part of Metro’s funding strategy
Metro and NAIF are working together to finalise documentation and satisfy customary conditions precedent to drawdown including all government approvals in relation to the financing.
The NAIF funding is a critical part of Metro’s funding strategy for execution of the expansion at Bauxite Hills by 2021.
The Investment Decision by NAIF is further confirmation of the strong long-term financial returns to be generated from the expansion.
The mine life is out to 2037 and following commissioning of Stage 2, Bauxite Hills is expected to be positioned in the lowest quartile of the global cash cost curve for bauxite producers.