Orion in advanced funding, partner talks
Fresh from releasing the updated bankable feasibility study for its Prieska copper-zinc project in South Africa, Orion Minerals is in advanced financing and partner talks ...
29th May 2020
Resources Rising Stars
Fresh from releasing the updated bankable feasibility study for its Prieska copper-zinc project in South Africa, Orion Minerals is in advanced financing and partner talks (reports MiningNews).
The updated study delivered a 43% increase in undiscounted pre-tax free cashflows to A$1.6 billion, or A$1.2 billion post-tax.
The net present value increased by 36% to $779 million pre-tax, or $552 million post-tax, while the pre-tax internal rate of return is up by 5% to 39%.
Total start-up capital costs dropped 7% to $373 million, though the peak funding requirement rose by 9% to $413 million as a result of operational improvements.
Orion managing director Errol Smart said funding the project was not an "insurmountable challenge".
The company has a market capitalisation of just over $50 million, which Smart described as "ludicrous".
"I don't see a better investment opportunity anywhere," he said.
Orion needs to fund 80% of the project, with its black economic empowerment partners to fund the balance.
Smart envisages 60% debt and 20% equity, and potentially some sort of subordinated debt or structured facilities like lease finance, supplier finance or offtake.
Orion has received debt proposals from seven institutions, including two specialist development finance institutions.
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