resgen.com.au
Resource Generation (ASX: RES) is developing one of South Africa’s largest remaining coal deposits, with the company's focos on the Boikarabelo tenements, in the Waterberg region of South Africa.
The strategy for the company is to develop high grade “energy” related resources into viable and competitive mining operations. Accelerated shareholder value will be delivered through the delivery of physical mining activity.
Resource Generation receives strong interest from debt funders for Boikarabelo
Resource Generation (ASX: RES) said that the company has received strong interest from financiers following a process to secure debt funding for the construction of its Boikarabelo mine in the Waterberg region of South Africa.
Potential debt funders were asked to submit expressions of interest and indicative term sheets, and submissions have been received which more than cover the company’s anticipated debt requirements.
Paul Jury, managing director, said ‘We are very pleased with the level of interest and look forward to working through the proposals with the potential lenders.
"The offers contain a number of conditions precedent including satisfactory contractual arrangements with Transnet and Eskom, which we are working towards.
"This is another positive step forward for our plans to start development of the Boikarabelo mine."
Last month Resource Generation ticked off another major milestone for Boikarabelo, with the company receiving formal documentation for a 30 year Mining Right.
Boikarabelo is forecast to start production towards the end of 2013, and is part of the Ledjadja joint venture with Resource Generation holding 74%.
Boikarabelo has a massive 6.4 billion tonne resource, a 120 metre thick coal seam at a shallow depth of 20-35 metres.
The current probable reserve is 745 million tonnes of thermal coal, which has the potential to increase as this reserve amounts to only 35% of the resource bearing tenements.
The Boikarabelo coal seam is between 20 and 30 metres below the surface, enabling low-cost, open-cut mining.
The seam is between 120 and 130 metres thick, with zones of varying quality thermal and soft coking coal.
Importantly, the Boikarabelo tenements are only 40 kilometres by road from an existing rail system that provides access to domestic markets and to the ports of Maputo, Richards Bay and Durban for export shipments.
These three ports all have potential to expand their coal capacity, and a proposed new railway to Walvis Bay in Namibia, if constructed, would also offer access to export markets.
