Development of the BBM Coal Project in Central Kalimantan continues on schedule with Cokal Ltd having secured further additional loan funds of US$5.65 million from a fund managed by Platinum Partners, bringing the total loan for the project development to date to US$9.15 million.
Due to the significant progress being made with the project and finalization of the BBM financing package, Platinum has agreed to advance the additional funds to ensure progress is maintained on the project while the final steps of the BBM financing documentation are put in place.
These funds will enable work on the detailed engineering and final design to progress and complete the preparation work necessary to enable site based construction to start promptly once the project financing is finalized.
Cokal has agreed to extend Platinum’s exclusivity period to October 6, 2014 to finalize the project finance agreements. Repayment of the first loan has been extended with the total loan of US$9.15 million now repayable within 6 months of receiving the additional loan funds. The total loan can also be rolled over into the BBM project financing facility once it is in place.
The BBM funding package included the proposed grant of 100 million warrants (options) with an exercise price of Aus$0.20 and an exercise period of four years from the date of grant. Cokal will grant 15 million of these options following drawdown of the additional loan. The intention is that the balance in options will, subject to shareholder approval, be granted once the BBM project finance is finalized.
The BBM project is in the prospective metallurgical Upper Barito Coal Basin, Regency of Murung Raya and covers 14,980 hectares. The project is adjacent to the Joloi project of BHP Billiton/Indomet Coal. www.cokal.com.au