20 January 2014, Windhoek – Paladin Energy has announced that it had entered into new loan agreements with its lenders for financing operations at the Langer Heinrich in the Erongo Region and the Kayelekera project in Malawi.
The Australian based firm said the new finance will provide significant cash flow benefits to both projects and leaves Paladin in a much stronger financial position.
The annual principal repayments across both projects will be reduced from US$53, 8 million per annum to US$18, 3 million per annum in calendar year 2014, a substantial reduction of US$35, 5 million, with the first repayment not due until June 2014.
In calendar year 2015, annual principal repayments under the old loan agreements compared to the loans will be reduced by a further US$23,7 million, the firm said.
Paladin said terms and conditions of the new loan for Langer Heinrich are largely the same as for the old loan agreement except for an increased amount, extension of term and a reduction in principal repayments from US$23,8 million per annum to US$18,3 million per annum.
In addition, Paladin has secured a US$20 million working capital facility to provide additional financial flexibility.
The new financing facility is provided by Nedbank Capital of South Africa, Nedbank Namibia Limited, the Standard Bank of South Africa and Standard Bank Namibia.
Both banks have been involved with Paladin since the first Langer Heinrich project loan agreement in in 2006.
“This successful refinancing is another important step in Paladin’s rigourous assessment of options to strengthen the business, both operationally and at a corporate level. Completing the refinancing during this period of depressed uranium prices and difficult market conditions is testament to the operational capability and financial robustness of Langer Heinrich. The project has continued to deliver superior production results at the same time as ongoing optimisation work has continued to reduce production costs,” said Paladin Managing Director and CEO John Borshoff.