West Perth-based resources development company Atlantic Limited has entered into a heads of agreement with Mineral Resources to re-launch the Windimurra Vanadium Project in Western Australia.
West Perth-based resources development company Atlantic Limited has entered into a heads of agreement with Mineral Resources to re-launch the Windimurra Vanadium Project in Western Australia.
As part of the deal Atlantic will become a 25 per cent equity holder in the project vehicle, Midwest Vanadium and arrange the new secured debt funding required to complete the commissioning of the project.
While Mineral Resources, which will complete construction of the plant and continue with the 'Build Own and Operate' contract for the project crushing and processing plants, and the current secured lenders to Midwest Vanadium will retain the majority equity stake in the project vehicle.
Atlantic managing director, Michael Minosora was delighted to join Mineral Resources in completing the highly attractive Windimurra Vanadium project which in the past has suffered from a combination of adverse factors and circumstances, including high gearing, construction cost over-runs and variable commodity prices.
"We have an experienced and very successful partner in MRL and we are confident that together we can get Windimurra onto a strong production footing," Mr Minosora said.
This latest announcement from Atlantic comes a few days after the company signed a memorandum of understanding (MOU) with a state-owned corporation to develop a new bauxite project in Vietnam.
The Windimurra transaction is consistent with Atlantic's focus on resources projects that are low cost, long life and near production and is complementary to the MOU signed with T-MV in Vietnam.
Full announcement below:
ATLANTIC JOINS MINERAL RESOURCES TO REVAMP WINDIMURRA VANADIUM PROJECT
Highlights
- Atlantic joins Mineral Resources to commission the Windimurra Vanadium Project
- Atlantic to acquire 25% equity stake in project vehicle
- Opportunity with strong leverage to vanadium market
- World scale vanadium project
- Clear pathway to project completion and production in 2010
Atlantic Limited (ASX: ATI; Atlantic) announces that it has entered into a heads of agreement with Mineral Resources Limited (MRL) to re launch the Windimurra Vanadium Project in Western Australia.
Under the terms of the heads of agreement, Atlantic will become a 25% equity holder in the project vehicle Midwest Vanadium Pty Ltd (MWVPL) and arrange the new secured debt funding required to complete the commissioning of the project.
The final funding amount is to be determined, but is expected to be sufficient to complete the plant construction and ramp-up to full production.
MRL and the current secured lenders to MWVPL will retain the majority equity stake in MWVPL.
MRL will also complete construction of the plant and continue with the 'Build Own and Operate' contract for the project crushing and processing plants.
MRL and Atlantic will now work towards the signing of definitive documentation with the Receiver of MWVPL, including the necessary finance documents, to facilitate the commissioning of the project.
Atlantic Managing Director Michael Minosora said that Atlantic was delighted to join Mineral Resources in completing the Windimurra Vanadium project.
"This is a highly attractive project that in the past has suffered from a combination of adverse factors and circumstances, including high gearing, construction cost over-runs and variable commodity prices," said Mr Minosora.
"We have an experienced and very successful partner in MRL and we are confident that together we can get Windimurra onto a strong production footing."
"We are particularly pleased to be working in partnership with MRL, which is a highly credentialed and successful Australian mining services and processing company."
"Atlantic and MRL are extremely well suited to work together at Windimurra and we look forward to developing a successful and enduring relationship."
For Atlantic, joining the MRL consortium gives it an equity stake in a specialist metal producer that has world market significance and exposure to potential commodity price upside.
Under the agreement, MRL will continue to operate the crushing and processing plants through its existing 'Build Own and Operate' contract entered into prior to MWVPL entering into administration in February 2009.
The heads of agreement is subject to procurement of the new secured debt funding package on terms mutually acceptable to MRL and Atlantic.
Mr Minosora said the transaction is wholly consistent with Atlantic's strategy to build a portfolio of large scale projects that will provide superior returns to shareholders.
Atlantic applies a highly disciplined, innovative approach to acquisitions and maintains a strong focus on resources projects that are low cost, long life and near production.
The Windimurra transaction is consistent with this strategy and is complementary to Atlantic's recent signing of a Memorandum of Understanding with Vietnamese state owned enterprise T-MV to develop a major new bauxite project in Vietnam.
