Cokal Limited has accepted a proposal for a funding package of up to US$150 million from Platinum Partners. The facility will be sufficient to fund construction and commissioning of Cokal’s Bumi Barito Mineral (BBM) Project in Central Kalimantan and the company’s general working capital requirements during the next phase of development.

Cokal’s chairman and CEO Peter Lynch welcomes such strong financial support from a major global financing partner such as Platinum Partners. “Their experience internationally and in the region coupled with their financial capability add a significant new dimension to Cokal and its ability not just to get the BBM Project into operation but for Cokal to develop its other resources in Indonesia and become a major global producer of premium quality coking coal supplying Asian steel producers in Indonesia, Japan, Korea, Taiwan, India and of course China.”

The total amount of the initial facility is being finalized but will be in the order of US$80 million to $100 million. It also includes a US$3.5 million bridging loan to provide funding to progress BBM while the facility is being finalized. The bridging loan can be rolled into the facility once it is in place.

Cokal has agreed an exclusivity period of 14 weeks from the drawdown of the bridging loan to finalize the funding arrangements. A break fee of 1.5% of the minimum commitment is payable if the arrangements do not close within this exclusivity period.

In addition to this financing, Cokal as part of the 50:50 river Barging Joint Venture with Meratus Advance Maritime (MDM) plans to raise bank financing for its share of the barging fleet (about US$15 million). The Platinum facility will provide the equity funding for Cokal’s share of the Barging Joint Venture.

“The Platinum financing is a significant achievement for the company and puts us on target for production in 2015,” says Peter Lynch. “The company has its resources focused on obtaining our final forestry approval which will enable construction to commence. With this approval and now with financing almost in place we should be able to proceed rapidly into construction.”

Resource Center Whitepapers, Videos, Case Studies