Shares in mineral sands-aspirant Sheffield Resources touched an all-time high today after the federal government approved a $95 million debt facility to develop the company’s Thunderbird project in the Kimberley.
Shares in mineral sands-aspirant Sheffield Resources touched an all-time high today after the federal government approved a $95 million debt facility to develop the company’s Thunderbird project in the Kimberley.
Sheffield shares finished ahead 8.13 per cent at $1.13 each today, after briefly touching $1.15 per share, and have gained 36 per cent in the past month.
A bankable feasibility study released in March last year revealed a development capex of $348 million for the project, with the first stage set to cost $260 million.
The loan will come through the government’s Northern Australia Infrastructure Facility and has been divided into two parts.
Sheffield will receive a $30 million project development facility and a $65 million infrastructure facility.
The West Perth-based company had previously arranged for a $US200 million debt structure with Taurus Mining Finance, which included a $US25 million contingent facility.
It will no longer need the contingent facility due to the NAIF funding.
Sheffield said the new funding would enable the company to in-source the power generation and accommodation facilities.
“The NAIF facilities will enable Sheffield to construct on-site LNG power generation and storage facilities at Thunderbird, in addition to enabling the upgrading of mine site roads, in-sourcing of mine site accommodation, and facilitating the construction and revitalisation of ship loading and logistics assets within the Port of Derby,” the company said in a statement to the ASX.
Managing director Bruce McFadzean said the company was delighted with the new debt facility.
“Whilst the NAIF facilities would not reduce total funding requirements, the proposed structure provides a pathway for Sheffield to own the asset infrastructure and provides for lower operating costs when compared to the Thunderbird BFS,” he said.
“NAIF’s approval of a concessional loan on the terms and tenor defined in the term sheets is a significant milestone for Thunderbird and will underpin many hundreds of jobs in the Kimberley region over several decades.”
Resources Minister Matt Canavan said the project would provide long-term benefits to the local economy.
“The mine has an estimated operating life of 42 years, an incredible time span when it comes to creating and supporting direct and indirect jobs for generations of Australians,” he said.
“This is great news for workers because the mine is going to provide intergenerational opportunities for the area, particularly the towns of Derby and Broome.”
The NAIF facilities were arranged with the assistance of Sheffield’s financial adviser Azure Capital.
