Kazakhstan-focused copper and gold explorer and producer Frontier Mining (LON:FML) said today that it had received the second US$5 million tranche of the US$10 million funding it announced in mid-June.
The funding deal is part of a copper off-take agreement with Red KiteMine Finance. The agreement is for four years from the commencement of production at Frontier’s Benkala copper oxide project.
Benkala is a 32.6 million tonne copper oxide resource, grading at 0.54 per cent copper. It is located in north-west Kazakhstan, closer to the Russian border, in an area that the company says presents favourable geography. The water table is within 25 metres of the surface and the flat landscape makes it ideal for heap leach processing.
In May 2010 Frontier commissioned an engineering firm to create a detailed design of a 20,000 metric tonne per year production facility. Pre-stripping of the mine and the commencement of site works also began last year.
Frontier reported recently that as of the beginning of June, construction for entire project was approximately 65 per cent complete. First production is expected in late 2011.
“Having already secured full funding for the Benkala project, these additional funds will further strengthen Frontier's balance sheet and enhance our ability to operate,” said Erlan Sagadiev, Frontier’s chief executive officer.