Namibian crawls back from the abyss

Namibian Minerals (NMR-T) has taken another step towards financial recovery by resuming marine diamond production off the coast of Namibia.

The Ya Toivo, which supports the Nam2 mining system, resumed operations and is expected to provide the bulk of Namibian’s production in 2001. The seabed crawler can mine 1.5 million cubic metres of material annually, or twice as much as its predecessor, the NamSSol.

In late February, Namibian was forced to place several subsidiaries into provisional liquidation, resulting in a halt to production. An earlier accident involving the NamSSol, followed by a year of unexpectedly low production, left the company unable to repay its debts.

Since then, Namibian has raised more than US$27 million on the market, though US$15 million is being held in escrow, pending shareholder and regulatory approval. That deal, which would see the Leviev Group of Israel become the company’s sole marketing agent and largest shareholder, with 39%, is expected to be approved by shareholders on April 25.

Nambian convinced its bankers to grant it a moratorium on debt repayment until October and to allow it to sell the Ivan Prinsep airlift vessel for US$4.4 million. Proceeds were used to reduce debt.

Similarly, a group of South African creditors has waived repayment rights for 12 months. The group is owed US$6 million.

Namco now plans to focus on discharging its companies from provisional liquidation and revising its operating plan for the remainder of the year. Repairs to the NamSSol system and the start of exploration are also set to get under way.

In light of the improvements, the Namibian and South African courts have granted the company another month to regain its composure.

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