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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."