Sumatra Copper & Gold says a variation to its finance facility, including deferral of a major equity raise, will enable it to complete another quarter of production at its Tembang Gold-Silver Project in South Sumatra, Indonesia before going to market.
Sumatra and its wholly-owned subsidiary PT Dwinad Nusa Sejahtera (DNS) have agreed terms with lenders and major shareholders to vary the amended US$45 million senior secured debt facility.
The variation provides for deferment of the majority of a US$12.5 million equity raise from June 30, 2017 to no later than November 30, 2017.
Under the varied facility US$7.5 million of the equity must be raised by November 30 with US$5 million to be raised by June 30. It also provides for deferment of US$7.5 million of the repayment of the senior secured debt facility to no later than November 30.
Another condition was to apply US$2.5 million of the US$5 million proceeds from the major equity raise to the repayment of the senior secured debt facility before June 30.
Also deferred to November 30 was any further funding of the debt service reserve account under the senior secured debt facility as well as the date for the conversion of convertible notes, or placement of CDIs to the value of any redeemed convertible notes.
Sumatra has received irrevocable and firm applications for CDIs to raise gross proceeds of approximately A$6.569 million (equivalent to US$5 million) from major shareholders Provident Minerals Pte Ltd and PT Saratoga Investama Sedaya Tbk. The placement satisfies the major equity raise under the variation and is being undertaken using the company’s placement capacity.
Sumatra’s managing director David Fowler said, “Deferral of the main component of the capital raise will allow us to complete another quarter of production before going to market. During this period, we expect production from the Belinau underground and Berenai open pit mines to improve as previously foreshadowed.”