LEPHALALE — The ASX and JSE listed resources company Resource Generation Limited (Resgen) released a market update in June 2019, detailing the progress on the funding of its long-awaited project in the Waterberg called Boikarabelo Coal Mine (Boikarabelo).
In the statement Resgen advised the market that the third and final unnamed member of the proposed Lending Syndicate has confirmed in writing its participation (credit approval) for their proposed contribution to the Company’s funding application in relation to the construction of Boikarabelo. Such participation is subject to certain terms and conditions as well as the Resgen board approval of Common Term Sheet.
The three-member Lending Syndicate’s funding package for the mine construction is confirmed to be R4,2 billion. For Resgen to have access to these funds, it must reach financial close. To reach financial close and to start the construction of the mine, a lot of work is still to be done. This is best described by Leapeetswe (Papi) Molotsane, the interim CEO of Resgen Ltd:
“We need to agree terms (with the Lending Syndicate), get shareholders’ approval of the funding package, meet conditions precedent, reach financial close and commence with the construction of the mine.”
Once Resgen has reached financial close, the next step will be to give contractor’s Notice to Proceed (NTP). Until then, management and staff of Boikarabelo will be focused on working hard to reach financial close.
In the meantime, Boikarabelo wishes to advise that it is not currently advertising jobs for the project. Interested and affected parties should NOT RESPOND to any misleading job advertisements. The management of the Boikarabelo Coal Mine will not communicate jobs or vacancies using Facebook, WhatsApp or SMS. Please ignore all such notifications.
Resgen is also at advance stages of negotiating the funding package for the R750 million for the construction of the 44 km rail link from the mine to the main Transnet network. In the lead up to commissioning of Boikarabelo, Resgen will also need to raise working capital currently estimated to be R500 million. Both the rail link funding and the working capital are conditions precedent to the main project funding.
Resgen will continue to keep the market informed regarding the progress of the project funding.