Vancouver — First Quantum Minerals (FM-T) has inked a deal for a Euro $14 million (US$15 million) term debt facility for its Mkubwa-Lonshi copper plant in central Zambia, Africa.
The European Investment Bank will provide the six-year debt facility that is repayable in equal annual installments of principal and interest starting July 2003. The debt facility is based on an interest rate linked to the First Quantum’s average realized copper price last year.
The interest rate ranges from a low of 3.0% when copper prices are at or below US$0.634 per lb. to a high of 12.5% at or above US$1.089 per lb. Based on the current LME copper price of US$0.74 per lb. the interest rate payable is 5.5%.
“We are very pleased to have the European Investment Bank as a lender to our Bwana Mkubwa-Lonshi operations, as they are committed long term investors with a mandate to foster development of projects in Sub-Sahara Africa,” said Philip Pascall, Chairman of First Quantum. “This facility is only a first step in our relationship with the European Investment Bank who will soon be mandated to provide long term funding for the development of our Kansanshi project in Zambia.”
The debt facility has the same rights and privileges as the existing Standard Chartered Bank three-year project debt facility, which was put towards the expansion of the Bwana Mkubwa SX/EW project upgrade.
The Bwana Mkubwa SX/EW plant was upgraded from an annual production rate of 10,000 tonnes of copper cathode to a minimum of 30,000 tonnes of copper cathode.
Early last year, First Quantum added new crushing, milling and pre-leach filtration facilities to the plant to handle higher-grading oxides from the Lonshi deposit in the Democratic Republic of Congo, about 35 km to the east. Until then, the plant was fed solely with tailings left over from the old Bwana Mkubwa open-pit mine. At last report, the Lonshi deposit hosted 5.1 million tonnes grading 5.75% copper. The remaining tailings at Bwana Mkubwa rang in at 2.1 million tonnes grading 0.77% copper.
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