Mining giant's US$50m boost
MINING company OGL Resources says it has achieved a significant milestone in the funding requirements to acquire and develop the Ebenezer coal mine and the massive Bremer View Project.
OGL is seeking to raise $60 million-$100 million to acquire the coal assets of Zedemar Holdings and recommission the Ebenezer mine near Amberley.
OGL says it has agreed to terms for a US$50m debt finance facility with EIG Global Energy Partners (EIG), a Washington-based energy and resources investment firm.
OGL managing director Allan Fidock told the Australian stock exchange EIG was completing a due diligence process on OGL's proposed project development plans.
He said once that process was complete, OGL would be able to achieve its goal of resuming mining at Ebenezer by the end of next year.
The funding would also allow the company to start environmental and mining studies on developing the Bremer View Project into a future mining area.
The 9202 hectare site has been found to contain more than 275 million tonnes of coal.
"The company welcomes the participation and financial support of EIG in our development plans which displays their confidence in the quality of the two tenements by their offering of this facility," he said.
Mr Fidock told the stock exchange the company's time frame depended on the outcome of a Supreme Court challenge to the Ebenezer Mine. Residents challenged the previous State Mines Minister's power to renew the mining lease (ML 4712) last September and the Supreme Court held a hearing in March.
In May, the case was dismissed but the residents appealed the decision. It was heard on September 12 and the judgement is expected any day and OGL is bullish about the outcome.
"Legal advice is [the] appeal will be unsuccessful and dismissed," Mr Fidock told the stock exchange.
"No injunction exists against ML 4712 hence no impediment to the tenement owner to be on ground now recommissioning the mine.
"No future injunction is legally possible.
"Last legal option is an application to the High Court of Australia, low risk [less than 5%] of High Court accepting application and hearing the case."
In phase one of its operation, OGL plans to recommence mining at Ebenezer at a rate of 600,000 tonnes per year within 12 months and expand to 1.5 million tonnes a year within two to three years.
Phase two would involve upwards of three million tonnes a year after four to five years from Bremer View.