- Major Shareholder agrees to provide CAD$10 million funding facility on competitive terms
- Funding to support ongoing design and engineering work ahead of securing regulatory approval and overall project funding
VANCOUVER, British Columbia, Jan. 28, 2014 (GLOBE NEWSWIRE) -- Coalspur Mines Limited ("Coalspur" or "Company") (ASX:CPL) (TSX:CPT) today announced that it had reached agreement with its major shareholder, Borrowdale Park, for the provision to Coalspur of a standby funding facility of CAD$10 million ("Facility"), subject to the execution of definitive documents.
As at December 31, 2013 Coalspur had approximately CAD$10 million cash. The majority of Coalspur's current monthly spend relates to detailed engineering and design work on the Vista project ("Vista"). The Facility ensures that Coalspur will be able to continue with this work on Vista, such that the project will be ready for construction once regulatory approvals and final development funding have been secured. A decision from the Alberta Energy Regulator regarding the approval of Vista is expected to be rendered on or before April 13, 2014, followed by decisions on Coalspur's remaining permits and licences.
The Facility will only be drawn upon if and when required. The Facility has an interest rate of 10.5% per annum and will be repaid from proceeds raised as part of the final overall Vista financing solution. Reasonable arrangement and commitment fees are payable by Coalspur. The Facility is in addition to the CAD$30 million balance owing to Borrowdale Park under the existing credit facility.
"This Facility ensures that we can continue spending on key aspects of Vista, as we continue with our focus on preparing for construction", said Gill Winckler, President and CEO. "Coalspur is very fortunate to have the continued support of Borrowdale Park as we progress discussions to secure the balance of our development funding for Vista, with a view to finalising funding arrangements following regulatory approval and permits."
Coalspur is a coal development company with approximately 55,000 hectares of coal leases located within the Hinton region of Alberta, Canada. Coalspur's flagship project is Vista, which covers approximately 10,000 hectares and provides a large scale, surface mineable, thermal coal development. Vista is located adjacent to CN Rail's main line, which is suitable for the transport of coal to deepwater ports on Canada's west coast. Coalspur has secured a port allocation agreement with Ridley Terminals Inc., which is essential to the logistics supply chain necessary to export coal from Vista to the growing demand from the Asia Pacific countries.
No regulatory authority has approved or disapproved of the information contained in this release.
This release contains forward-looking information concerning Coalspur, including information regarding Coalspur's plans for Vista, the AER regulatory process, expected commencement of development and production, expected receipt of regulatory approvals or licenses, and other matters. All statements in this release, other than statements of historical facts, that address events or developments that Coalspur expects to occur, are statements of forward-looking information. Although Coalspur believes that such forward-looking information is based on reasonable assumptions, such information is not a guarantee of future performance and actual results or developments may differ materially from the forward-looking information. Material factors or assumptions used by Coalspur to develop forward-looking information include the following: (1) that all required third party approvals will be obtained for the development, construction and production of its properties; (2) that additional financing will be available on reasonable terms; (3) there being no significant disruptions affecting operations, whether due to labour disruptions, supply disruptions, power disruptions, damage to equipment or otherwise; (4) permitting, development and expansion proceeding on a basis consistent with the Company's current expectations; (5) currency exchange rates being approximately consistent with current levels; (6) certain price assumptions for coal; (7) production forecasts meeting expectations; (8) the accuracy of the Company's current mineral resource and reserve estimates; (9) labour and materials costs increasing on a basis consistent with the Company's current expectations; and (10) assumptions made and judgments used in engineering and geological interpretation. Factors that could cause actual results to differ materially from the forward-looking information, include but are not limited to: risks associated with funding requirements for Vista development; fluctuations in coal prices; uncertainties related to the availability of future financing; risks related to Coalspur's existing credit facility, risks associated with take or pay commitments with Ridley Terminals, risks associated with the need for governmental licences, permits and approvals, uncertainties related to aboriginal claims and multiple mineral development, and uncertainties related to general economic, market and business conditions. For more information on Coalspur, investors should review Coalspur's continuous disclosure filings that are available at www.sedar.com and www.asx.com.au.
CONTACT: Greg Bittar VP, Investor Relations Australasia firstname.lastname@example.org P: + 61 409 611 744 Ryan Walchuck Investor Relations North America and Europe email@example.com P: +1 604 220 8595 David Montpetit VP, External Affairs and Logistics firstname.lastname@example.org P: +1 403 801 1344Source:Coalspur Mines Ltd.