Higfield secures debt for Muga development

PERTH (miningweekly.com) – ASX-listed Highfield Resources has secured credit approvals from a syndicate of four international financial institutions for up to €320.6 million of secured project finance facilities from first row to finance the development of the Muga potash project in Spain.

The senior facilities will include a €300 million senior credit facility to finance the construction and development of the project, and a €20.6 million cost overrun credit facility to be used, if necessary, for the construction and development of the project.

The term of the Senior Credit Facility will be ten years and the term of the Cost Overrun Credit Facility will be five years. Closure of senior facilities is subject to customary terms, including negotiation and settlement of final documentation.

“We are delighted to announce the credit approval of €320.6 million of credit facilities from BNP Paribas, ING, Natixis CIB and Société Générale. This step represents the conclusion of an intensive due diligence process and in-depth which included site visits by commissioned lead arrangers and independent experts carrying out environmental, social, technical, marketing and legal assessments of the project,” said Highfield’s CEO. Ignatius Salazar.

“With the completion of preliminary works around the mine gate, securing funding for the project was an essential step in advancing the construction of the project.”

An updated feasibility study on the Muga-Vipasca potash project estimated a capital cost to develop the project at €607 million. Over its 30-year life, the project is expected to produce 27.5 million tonnes of muriate of potash, with phase 1 of the operation producing 500,000 t/y and phase 2 increasing production to one million tons per year.