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Alloycorp Mining Inc. (TSXV:AVT) released an update on its Avanti Kitsault project, commenting that DRA Taggart LLC is in the process of completing a Front End Engineering Design (FEED) study for the project.

Alloycorp Mining Inc. (TSXV:AVT) released an update on its Avanti Kitsault project, commenting that DRA Taggart LLC is in the process of completing a Front End Engineering Design (FEED) study for the project.
The FEED study is aimed at “assessing the current engineering, procurement and project plans completed for the Project,” and once it’s finished the company will be able to confirm the scope, budget and schedule for Avanti Kitsault’s construction. The press release states:

The FEED Study is expected to be completed in the third quarter of 2015.
In conjunction with work completed from the FEED Study, Alloycorp continues to develop a revised estimate of initial construction capital, sustaining capital, metallurgical recoveries and operating costs. This work is intended to provide greater clarity on costing and scope and will be incorporated into an updated NI 43-101 compliant technical report, targeted for completion by the end of 2015.
Alloycorp is also pleased to announce that DRA and Aecon Group Inc. (“Aecon“) are in discussions regarding a joint venture partnership, whereby DRA and Aecon will together explore an engineering and construction partnership structure for the development of Avanti Kitsault.

In terms of financing, Alloycorp said:

Alloycorp continues to pursue credit commitments from a syndicate of lenders, pursuant to the US$612 million debt financing mandate letter agreement announced July 29, 2014. To-date, US$225 million in commitments have been provided. No further credit commitments are expected until after completion of the FEED Study, after which time it is expected the lenders will continue working towards credit approval, subject to the commodity price and general market conditions at that time.

All in all, the company expects its financing requirements to be met by 2016. Gordon Bodgen, president and CEO of Alloycorp, commented:

While Alloycorp, along with its industry colleagues have experienced certain challenges due to the decline in commodity prices, particularly in the last twelve months, all of our stakeholders remain very much engaged on the financing and development of Avanti Kitsault. However, we are in a unique position that all our partners remain very much engaged on the financing and development of Avanti Kitsault. Our lenders and financial partners remain very supportive and are awaiting positive economic results from the FEED Study. In the meantime, we continue to advance discussions with potential equity investors, partners and streamers. We strongly believe that progressing Avanti Kitsault now will position us well for a recovery in commodity prices.

Click here to read the full Alloycorp Mining Inc. (TSXV:AVT) press release.

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