Trevali Mining has suspended the planned expansion of its Rosh Pinah mine after defaulting on a N$124.4 million (US$7.5 million) revolving credit facility repayment.
This comes as the TSX-listed firm has faced several setbacks in the past few months, including a flooding event that shuttered its Perkoa mine, in Burkina Faso. The Caribou operation, in Canada, continues to suffer from low productivity rates and equipment availability.
Its shares have been suspended from trading on the Toronto Stock Exchange, with Lima Stock Exchange, OTCQX and Frankfurt Stock Exchange expected to follow suit, and was granted an initial order for protection from the British Columbia Supreme Court under the Companies’ Creditors Arrangement Act (CCAA).
Last week the miner also suspended the N$330 million (US$20 million) Early Works programme at Rosh Pinah Mine and put it under review.
However, Trevali, which recently filed for protection from its creditors, is now pursuing a new financing scheme for the project.
Early this month, the base metals miner received credit approval from Standard Bank Namibia and Standard Bank of South Africa for a Senior Secured Financing Facility of N$1.86 billion (US$110 million) to fund the expansion, but still has to negotiate other components of the agreement.
Some of the conditions to be met include negotiation and settlement of definitive loan facility and security documentation as well as the execution and delivery of definitive documentation in respect of the other elements of the comprehensive financing package.
The parties also need to implement an intercreditor agreement between Standard Bank and the various subordinated secured lenders, and the consent of and release of existing security by Trevali’s existing senior secured lenders.
The credit approval follows the execution of a mandate agreement with Standard Bank in March of this year and completion of legal and technical due diligence of the Rosh Pinah Mine and the RP2.0 project, including a site visit to the operation.
Trevali is also pursuing the arrangement of an Export Credit Agency (ECA) backed equipment finance facility, which may increase the amount available under the Senior Secured Financing Facility by up to N$336 million (US$20-million).
The RP2.0 project aims to increase Rosh Pinah’s throughput from 0.7 million tonnes a year to 1.3 million tonnes a year through the modification of the processing plant, construction of a paste fill plant, and development of a dedicated portal and ramp to the WF3 deposit.
