The Conversation (0)
Lucapa Diamond Company Ltd. (ASX:LOM) announced that it’s agreed to key terms for a financing deal aimed at doubling its alluvial diamond-mining operations. Its cashflow should increase “significantly” as a result.
Lucapa Diamond Company Ltd. (ASX:LOM) announced that it’s agreed to key terms for a financing deal aimed at doubling its alluvial diamond-mining operations. Its cashflow should increase “significantly” as a result.
Key points outlined in the press release include:
- Lucapa has agreed key terms for A$4.5m in funding for new Caterpillar fleet
- Deal will see new Caterpillar earth moving equipment used to double diamond mining operations at Lulo to 20,000 bulk cubic metres per month
- Strategy is aimed at accelerating and increasing cashflow from alluvial diamond mining
- New Caterpillar equipment will also enable a standalone fleet to operate the kimberlite exploration program at Lulo in parallel with alluvial diamond mining
- Commercial terms of Caterpillar deal are favourable compared to the original debt financing offer and mean Lucapa can double mining rates and increase cashflow with minimal debt
- New fleet is available ex-stock in Angolan capital of Luanda for immediate delivery
Stephen Wetherall, CEO of Lucapa, commented:
Since we signed the term sheet for the original US$15 million financing proposal back in January 2015, we have made significant funding progress. Lucapa has raised A$4.8 million in fresh equity via a share placement and the Lulo partners have continued to recover high value diamonds which have sold for A$3.7 million, leaving the project well-funded. We are also now finalising a A$4.5 million fleet financing arrangement for new Caterpillar earth moving equipment on favourable financing terms.
To procure this equipment externally and have it shipped into Angola would have taken approximately four months, so we are obviously delighted the equipment required to scale up our diamond mining operations is both in-country and in-stock.
The Caterpillar deal also provides us with an opportunity to use a similar financing structure to source the additional earth moving fleet required to ultimately scale up to a processing rate of 40,000 bcm/month in the future once the short-term financing agreement is completed.
Click here to read the full Lucapa Diamond Company Ltd. (ASX:LOM) press release.