Nevada Copper secures $200 million six-year loan from Red Kite

By Lisa Kerner

Charlotte, N.C., Dec. 30 – Nevada Copper Corp. closed a $200 million senior secured loan facility and copper concentrate off-take agreement with RK Mine Finance (Red Kite), replacing the company’s previous loan facility entered into on March 28, 2013.

The facility matures on Dec. 31, 2020, with interest payable at an annual rate of Libor plus 1,000 basis points during pre-completion and Libor plus 750 bps post completion, according to a company news release.

Interest is payable quarterly with a principal repayment holiday until Sept. 30, 2017, following which $82.5 million of outstanding principal will be repaid in 13 quarterly sculpted payments. The remaining outstanding principal will be repaid in one final balloon payment on the maturity date.

Nevada Copper may repay the loan in full without penalty prior to maturity and the loan is secured against all current and future assets of the company and its subsidiaries.

Proceeds of $57.1 million from the initial $90 million drawdown on closing were used for to repay the previous facility. The proceeds will also be used to advance the underground mine on Nevada Copper’s 100% wholly owned Pumpkin Hollow copper project located near Yerington, Nev.

A further $110 million will be advanced on the completion of certain project and financing milestones, the company said.

Off-take agreement

Under the terms of the concentrate off-take agreement, Nevada Copper will sell up to 74.5% of copper concentrates produced from the underground mine to Red Kite for the life of the mine.

“We are extremely pleased with the closing of this financing with Red Kite, a new facility that will provide greater flexibility in repayment and will defer principal repayment from April 2015 to September 2017 when compared to the previous facility,” said president and chief executive officer Giulio Bonifacio, in a news release.

Nevada Copper is a Vancouver, B.C.-based mining company.

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