Tri-Star Resources PLC Tri-Star invests a further $2.8 million in SPMP (7583C)
24 January 2018 - 6:06PM
UK Regulatory
TIDMTSTR
RNS Number : 7583C
Tri-Star Resources PLC
24 January 2018
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No. 596/2014 until the release of this
announcement
24 January 2018
Tri-Star Resources plc
("Tri-Star" or the "Company")
Tri-Star invests a further $2.8 million in Oman joint venture
company SPMP
Investment in SPMP
Tri-Star announces that it has invested a further $2.8 million
(GBP2.05 million) via additional mezzanine loan to Strategic &
Precious Metals Processing LLC ("SPMP") ("SPMP Mezzanine Loan") to
assist in further development of the Oman Antimony Roaster Project
("OAR"). The OAR is located in Sohar, Sultanate of Oman. Tri-Star
has a 40% equity interest in SPMP.
The investment in SPMP has been financed from Tri-Star's
existing cash resources, constituting part of the proceeds of the
recent Open Offer to shareholders. Of the remaining net proceeds of
the Open Offer, $2.7 million (GBP2.0 million) has been applied to
part repay loans outstanding from funds under the discretionary
management of Odey Asset Management. The balance of the GBP4.42
million of funds raised from the Open Offer (being GBP0.37 million)
has been retained to pay the costs of the Open Offer and provide
additional funds for general corporate purposes.
The terms of this $2.8 million SPMP Mezzanine Loan are identical
to the existing mezzanine loan Tri-Star invested in SPMP in
November 2017. Contemporaneous with this investment, the two other
shareholders in the OAR have invested further funds of $13.2
million in the project. Since November 2017, therefore, SPMP
shareholders have invested a total of $22 million of additional
funding into the OAR, of which Tri-Star has invested $8.8 million
(including this latest $2.8m) representing 40% of the total
additional funding of $22 million. All these investments have been
made on the same financial terms as each other.
OAR Update
Supply
The first batch of antimony concentrate has been delivered to
the OAR's warehouse in Sohar. Discussions with multiple supply
providers continue as the SPMP team focuses on off-take agreements
with key consumers and traders.
Financing
SPMP is finalising agreements with providers of bank finance on
an additional funding package which will satisfy all SPMP's funding
requirements through to commercial production. Further
announcements concerning this will be made by Tri-Star, as
appropriate.
Capital cost
The forecast capital cost to complete the OAR has increased
marginally, by $1 million, to $109 million mainly due to the impact
of movements in exchange rates. Of the $109 million, $74 million
has been committed and SPMP expects all items of major equipment
will be on site by the end of this month. SPMP's focus is now on
completing the cabling and piping interconnections between the
major production elements; as well as completion of two buildings
and instrumentation controls.
Commissioning
Commissioning of the OAR is expected to be delayed due to the
late supply of switchgear and the required connection to main grid
power. Various permissions and compliance requirements mean that
the date for switching medium voltage power on may need to be
pushed back from current schedule. SPMP's management team is
endeavouring to minimise this delay but this will be dependent on
other factors, including implementing a sequential electrification
programme across the whole site with the relevant utilities and
local authorities.
References to "$" in this announcement mean US dollars.
Enquiries:
Tri-Star Resources plc Tel: +44 (0) 20 3470 0470
Guy Eastaugh, Chief Executive Officer
SP Angel Corporate Finance (Nomad and Broker) Tel: +44 (0) 20 3470 0470
Robert Wooldridge / Jeff Keating
Yellow Jersey PR Limited (Media Relations) Tel: +44 (0) 776 932
5254
Charles Goodwin / Joe Burgess
This information is provided by RNS
The company news service from the London Stock Exchange
END
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