AIM Code : MTL At:27 May 2014 Shares in Issue: 1,374,972,024 Options in Issue: 7,275,000 Directors: Ian Holzberger, Executive Chairman Timothy Dean Guy Walker Christopher Whitehouse Julian Wilson Jeremy Ayre Management: Ian Holzberger, Executive Chairman Liam Ruddy, Company Secretary John Stubbs, CFO Craig Watkins, GM Runruno Project Chevy Albo, Finance & Administration Rosalie Soriano, Legal Counsel Agnes Goze, Environment & Permitting Tommy Alfonso, Financial Controller Peter Storey, GM Mining, Larry McGeechan, GM Process Plant Construct Kevin Oxenham, GM Maintenance Chris Schlemmer , GM Site Services Jeff Jardine, Process Engineering Mgr. For further Information please contact: Metals Exploration plc Ian Holzberger: +61 41 888 6165 Liam Ruddy; +44 7911 719 960 Nominated Adviser: Westhouse Securities Limited Martin Davison +44 (0)20 7601 6114 Broker: SP Angel Corporate Finance LLP Ewan Leggat +44 (0)20 3463 2260 Public Relations: Tavistock Communications Edward Portman / Jos Simson +44(0) 20 7920 3150 |
Highlights: · US$83 million Runruno project finance debt secured from two international banks, the Hongkong and Shanghai Banking Corporation Limited (HSBC) and BNP Paribas. · Funding comprises: o US$75 million senior debt facility which includes a US$5 million provision for rolled up capitalised interest and fees during construction; and, o US$8 million overrun facility. · The funding will be applied to the remaining development of the Project including the processing plant. · First drawdown of the Debt Facility will occur following the satisfaction of typical conditions precedent by the Company. · The Runruno Gold Project is on track to commence commissioning in Q1 2015. The Debt Financing Facility In the second half of 2013, the Company through its wholly owned operating subsidiary FCF Minerals Corporation ("FCF") appointed HSBC as Coordinator and Mandated Lead Arranger to secure a suitable debt financing solution sufficient to take the Group through the development and construction phase of the Runruno Gold project and into commercial production. HSBC was joined subsequently by BNP Paribas as joint Mandated Lead Arranger following which due diligence was completed, terms were finalised and the Facility Agreement was signed on 28 May 2014. |
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About Runruno Gold Project, Location: Central Luzon, Philippines, 320km north of Manila. Status: Development ready, Feasibility study completed May 2010. Mine life: 10.3 years. Payable Au: 1 million ozs. Annual Production: Year 1-5: 101,800 ozs Au ave. Years 6-10: 92,700ozs Au ave. Capital Cost1: US$182.8 m Operating Cost2: US$ 474 /oz Au Mining: Open pit, truck and shovel operation. Operational Strip Ratio: 5.2:1 waste to ore. Processing: gravity, BIOX® oxidation and CIL to recover gold as doré bullion. 2P Reserves3: 15mt @ 1.85g/t Au and 603 ppm Mo. Mineral Resource3: Runruno Main - 26mt @1.69 g/t Au and 453ppm Mo, including reserves. Malilibeg South - 7.55mt @1.4 g/t Au and 1,200 ppm Mo Upside: by-product molybdenum, mine life extension, highly prospective mineralised system. Notes: 1. Capital Cost updated October 2011 - estimated in Q3 2011 US$, at US$167.8 million increased by the cost of the acquisition of the mining fleet at US$15 million 2. Average operating cost for the first 5 years of operation. Costs re-estimated in Q4 2013 US$ based on actual and known costs and hard quotations 3. Refer to the Company website, www.metalsexploration.com for complete Mining Reserve and Mineral |
Initially the Company will guarantee the Debt Facility, which guarantee will fall away on achieving Project Completion. The Company's guarantee will be supported by limited recourse security over the Company's shares owned in FCF Minerals Corporation, together with certain other limited recourse securities over its Philippine assets. The Debt Facility is for a 55 month duration maturing on 31st December 2018 and will bear a competitive commercial rate of interest consistent for a project financing of this nature. Additionally, FCF Minerals Corporation will hedge approximately 40% of the interest rate exposure under the Debt Facility and, subject to the gold price achieved, enter into a gold forward sales program representing a maximum of 35% of the annual forecast gold production over the term of the Debt Facility. It is currently envisaged that a program of approximately 90,000 - 105,000 ounces (or approximately 30% of gold production over the term of the Debt Facility) will be entered into by way of forward sales. Runruno Gold Project Capital Expenditure, Forecast CAPEX and Group Cash Position As announced on 11 March 2014, the forecast capital expenditure programme for Runruno is US$182.8 million to practical completion, inclusive of project contingency. At the end of April 2014, the remaining capital expenditure committed or yet to be incurred (including the Residual Storage Impoundment) is US$87.3m million which will be funded by way of cash at bank (equivalent of US$28.8 million) and the US$83 million Debt Facility. The current status of the capital expenditure programme is summarised below:
Capital expenditure incurred to 30 April 2014 |
US$95.4 million |
Capital expenditure commitments outstanding as at 30 April 2014 |
US$26.6 million |
Capital expenditure yet to be committed as at 30 April 2014 |
US$60.8 million |
Total forecast expenditure as at 30 April 2014 |
US$182.8 million |
Use of Proceeds The Project is being constructed under a "self-manage" strategy by assembling an owner's construction team to manage the activities, using specialist contractors and sub-contractors to execute the outstanding works. |