Centaurus in $6m debt funding

Perth-based explorer Centaurus Metals has entered into an exclusive mandate for a $6 million working capital facility with RMB Resources’ Australian subsidiary to fund development of its Candonga iron ore project in Brazil.

The iron ore hopeful said the facility would also be used to support ongoing exploration programs and for general working capital requirements.

The news boosted Centaurus shares by 35.3 per cent to 6.9 cents per share at 9:30am.

According to a feasibility study on Candonga, which was completed in September last year, the project has a pre-production cost estimate of $3.6 million for a 300,000 tonnes per annum operation.

“Candonga is a quality project which will generate strong cash flows due to its very low cash costs,” Centaurus managing director Darren Gordon said.

“RMBR’s initial feedback on the project has been positive, and we will now work with them to assist their due diligence process for the facility to allow us to commit to development of the project in the shortest possible timeframe.”

The company expects RMBR to complete its due diligence process by the end of January and provide an approved offer of finance by the end of February.

The Candonga project is located 33 kilometres south of Centaurus’ flagship Jambreiro iron ore project, which is currently in a pre-construction phase.