12/11/2018 - 13:45

Sheffield locks in engineering, debt deals

12/11/2018 - 13:45

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Sheffield Resources has confirmed GR Engineering Services will design and build the processing plant for the mineral sands-focused company’s Thunderbird project in the Kimberley.

Sheffield locks in engineering, debt deals
Bruce McFadzean says the company is delighted with the new debt facility.

Sheffield Resources has confirmed GR Engineering Services will design and build the processing plant for the mineral sands-focused company’s Thunderbird project in the Kimberley.

Under the $366 million contract, GR Engineering will construct a 7.5 million tonnes per annum mineral processing plant and supporting infrastructure.

The announcement of the engineering, procurement and construction contract comes after GR Engineering was selected as preferred tenderer to complete early works in October 2017.

The contract is expected to be completed over a two-year period, with work forecast to begin in the second quarter of 2019.

GR Engineering’s scope of work under the contract extends to all process and non-process infrastructure for the project, including a wet concentrate plant, mineral separation plant, low temperature roasting plant, administration buildings, bore fields and high voltage power distribution in addition to all civil scope items.

GR managing director Geoff Jones said the contract was an important milestone for the project.

“GR Engineering has welcomed the opportunity to contribute towards bringing the project to an advanced pre-execution phase and is now committed to progressing its safe and successful delivery for Sheffield,” he said.

Sheffield also announced the signing of a $US175 million ($240 million) debt facility with Taurus Mining Finance.

The seven-year term loan will partially fund the Thunderbird project and includes two tranches.

The first tranche of $US75 million will hold an interest rate of USD London Interbank Offer Rate plus 4.5 per cent, while the second $US100 million tranche will have an 8.5 per cent rate of interest.

“These agreements are a tremendous result for Sheffield shareholders as they substantially de-risk Thunderbird and put the company in a strong position to move into construction,” Sheffield managing director Bruce McFadzean said.

“We now have a full EPC contract with one of Australia’s leading process engineering companies, with extensive experience in Western Australia and in the delivery of mineral sands projects.

“Additionally, we have executed $US175 million of senior debt financing with Taurus, one of the world’s premier mining finance funds.

“The Taurus Facility Agreement has provided certainty of funding for the development of Thunderbird and now includes the expanded Northern Australia Infrastructure Facility (NAIF) loan facilities.”

Shares in Sheffield finished up 8.75 per cent at the close, while GR Engineering shares were flat at $1.28 each.

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