- Published: 02 October 2008
- Written by Editor
Equinox Establishes Additional Debt Facility for Project Completion and Lumwana Insurers Accept Fire Indemnity
<< /NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE U.S./ >>
Equinox Minerals Limited (TSX and ASX symbol: "EQN") ("Equinox" or the "Company") is pleased to announce the signing of a new US$80.0 million loan facility ("New Loan Facility") underwritten by Standard Bank Plc and Standard Chartered Bank and to be provided by certain members of the existing Lumwana Copper Project (the "Project") banking syndicate. The New Loan Facility is structured on similar terms to the commercial tranche of the US$583.8 million Project finance debt facilities as announced December 01, 2006.
Equinox believes it prudent and advantageous to establish the additional debt finance facility at this time. The Company has also successfully renegotiated the repayment schedule to commence at the end of Q3-09 with respect to some elements of the US$583.8 million facilities reflecting the revised Project startup timetable.
The New Loan Facility will enable the Company to meet the additional working capital requirements that resulted from the delayed startup. Equinox considers that the establishment of this New Loan Facility is preferable to drawing down its existing US$45.0 million Contingent Funding Facility, thereby ensuring that the Company maintains appropriate levels of liquidity while limiting shareholder dilution. The Contingent Funding Facility (as announced June 29, 2007) was established to provide the Company with a Project cost overrun provision and remains available to Equinox.
On July 07, 2008 Equinox announced that an electrical fire incident (the Incident") at the Project caused damage to the 20MVA transformer and adjacent 11KV substation subsequently delaying commissioning and the commencement of copper concentrate production from the Project. The Company reports that rectification works remain on schedule for a December 2008 commissioning (as announced July 18, 2008) with all replacement equipment now available on site for installation and remediation.
Following the Incident, the Company reports that insurance enquiries have now concluded with the Project insurance syndicate accepting indemnity for the Incident and the Company quantifying its losses for submission to the insurers. The Company also confirms that it is continuing to receive liquidated damages from its EPC Contractor (a joint venture between Ausenco Projects Limited and Bateman International Projects BV, a subsidiary of Bateman Engineering NV).
Mr Craig Williams, Equinox's President and CEO commented, "The New Loan Facility is evidence of the strong confidence our banking syndicate has in the Project. Along with confirmation of receipt of our Incident insurance indemnity, Equinox and its shareholders can now be afforded, during this unprecedented period of market volatility, the necessary levels of stability and liquidity required to expeditiously move the Project into copper concentrate production and deliver further shareholder value."
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On Behalf of the Board of Directors of Equinox:
Craig R. Williams - President & Chief Executive Officer
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Cautionary Language and Forward Looking Statements
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This press release contains "forward-looking statements" and "forward-
looking information", which may include, but is not limited to,
statements with respect to the future financial or operating performances
of Equinox, its subsidiaries and their respective projects, the future
price of copper and uranium, the estimation of mineral reserves and
resources, the realization of mineral reserve estimates, the timing and
amount of estimated future production, estimated costs of future
production, capital, operating and exploration expenditures, costs and
timing of the development of the Lumwana Project, the costs of Equinox's
hedging policy, costs and timing of future exploration, requirements for
additional capital, government regulation of exploration, development and
mining operations, environmental risks, reclamation and rehabilitation
expenses, title disputes or claims, and limitations of insurance
coverage. Often, but not always, forward-looking information can be
identified by the use of words such as "plans", "expects", "is expected",
"is expecting", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", or "believes", or variations (including
negative variations) of such words and phrases, or state that certain
actions, events or results "may", "could", "would", "might", or "will" be
taken, occur or be achieved. The purpose of forward-looking information
is to provide the reader with information about management's expectations
and plans for the Company. Readers are cautioned that forward-looking
information involves known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or achievements
of Equinox and/or its subsidiaries to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking information. Such factors include, among others, those
factors discussed in the section entitled "Risk Factors" in the Company's
annual information form, which is available at www.SEDAR.com. Although
Equinox has attempted to identify statements containing important factors
that could cause actual actions, event or results to differ materially
from those described in forward-looking information, there may be other
factors that cause actions, events or results to differ from those
anticipated, estimated or intended. Forward-looking information contained
herein are made as of the date of this document based on the opinions and
estimates of management on the date statements containing such forward
looking information are made, and Equinox disclaims any obligation to
update any forward-looking information, whether as a result of new
information, estimates or opinions, future events or results or
otherwise. There can be no assurance that forward-looking information
will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such information.
Accordingly, readers should not place undue reliance on forward looking
information.
Technical information in this release is summarized or extracted from the
"Amended Technical Report on the Lumwana Copper Project, North Western
Province, Republic of Zambia" dated June 2008 (the "Technical Report"),
prepared by Michael Davis, Process Manager, Ausenco Ltd. ("Ausenco"),
Ross Bertinshaw, Principal of Golder Associates Pty Ltd. ("Golder"),
Andrew Daley, Director, of Investor Resources Finance Pty Ltd ("IRF"),
Daniel Guibal, Corporate Consultant (Geostatistics and Resources), of SRK
Consulting (Australasia) Pty Ltd ("SRK") and Robert Hanbury, Associate
Director, of Knight Pi�sold Pty Ltd. ("Knight Pi�sold"), each of whom is
a "Qualified Person" in accordance with National Instrument 43-101 -
Standards of Disclosure for Mineral Projects.
Readers are cautioned not to rely solely on the summary of such
information contained in this release, but should read the Amended
Technical Report which is posted on Equinox's website
(www.equinoxminerals.com) and filed on SEDAR (www.sedar.com) and any
future amendments to such report. Readers are also directed to the
cautionary notices and disclaimers contained herein. All currency in this
release is U.S. dollars unless otherwise stated.
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SOURCE: Equinox Minerals Limited
Craig R. Williams, (President and Chief Executive Officer), Michael Klessens, (V.P.
Finance and CFO), Phone: +61 (0) 8 9322 3318, Email: This email address is being protected from spambots. You need JavaScript enabled to view it.; or
Kevin van Niekerk, (V.P. Investor Relations/Corporate Development), Phone: (416)
865-3393, Email: This email address is being protected from spambots. You need JavaScript enabled to view it.; For information on Equinox
and technical details on the Lumwana Project please refer to the company website at
www.equinoxminerals.com