Thursday, March 28, 2024

Equinox secures $103bn debt

Share

EQUINOX Minerals has bucked recent trends amid the credit freeze and secured $US80 billion ($103 billion) in debt for its Lumwana copper project in Zambia, underpinning confidence in the project and sparking speculation the company could fall prey to the likes of Rio Tinto.

The Lumwana project is due to come on line at the end of the year and is expected to produce 172,000 tonnes of copper a year from 2009 and run for 37 years.

Credit Suisse analyst Julian McCormack said that the debt facility was a vote of confidence in the project and recent slumping share markets made the company a target for bigger players looking to boost copper production.

“We view this as a significant validation of the project and the people managing it,” Mr McCormack said in a note to clients at the weekend.

“You cannot build a Lumwana-sized project for what it will cost to buy Equinox today,” he said.

Mr McCormack pointed to recent reports quoting Rio Tinto management as saying the miner wanted to buy copper producers of around 200,000 tonnes a year with long mine lives.

“Lumwana, which will be in production this decade, is the only asset anywhere on the globe that matches this description,” he said.

Perth-based Equinox, which is listed on the Australian and Toronto stock exchanges, has a market value of $1.63 billion.

Its shares have slumped more than 50 per cent this year.

The $US80 million loan facility is underwritten by Standard Bank and Standard Chartered Bank and will be provided by members of Equinox’s existing Lumwana banking syndicate.

The facility will let the company meet extra working capital requirements that resulted from start-up delays after an electrical fire in July.

Equinox also renegotiated the repayment schedule for some elements of the existing $US583.8 million project finance debt facilities.

“The new loan facility is evidence of the strong confidence our banking syndicate has in the project,” Equinox chief executive Craig Williams said.

“Equinox and its shareholders can now be afforded, during this unprecedented period of market volatility, the necessary levels of stability and liquidity required to expeditiously move the project into copper-concentrate production and deliver further shareholder value.”

Rio Tinto copper chief executive Bret Clayton said last week that his company was “scouring opportunities” as the credit crisis made it harder for juniors to raise money.

The Australian

21 COMMENTS

  1. a real invetors is when you compare the place they have invested if today you go to lumwana the area just look the same no change while they anonce all those big moneies next time translate those money to real things that can be seen not just on papers make those poor fellow happy coz they work so hard and then nothing reaches them
    give the hospital and good schools for thire poor children given good water supply and health sanitation as for me thats investment and development than wasting poor pipos time lying to them like that

  2. #1 you’re right. It’s certainly not a 100 billion dollars, thats 1/7 of what they are bailing the American economy out with.

    I would be the happiest person if it were $100bn, even $1bn but lets stop sensationalising.

  3. I was at the The Australian site. I read the same article and say ”
    EQUINOX Minerals has bucked recent trends amid the credit freeze and secured $US80 million ($103 million) in debt for its Lumwana copper project in Zambia, underpinning confidence in the project and sparking speculation the company could fall prey to the likes of Rio Tinto.”

    Why replace the millions with Billions ?

  4. yea, A$103 millions and not billions. I don’t expect good development around Lumwana by Equinox alone without GRZ coming on board. I don’t see australian companies building towns in their home land.

  5. Even in the context of the credit crunch, $80M is not a lot of money. The Zambian press should learn how to adequately report on business and the economy. All they know is politics and sport.

  6. Please dont forget to vote for McCain for president…i love you guys please help me realise my dream of becoming the first female VP of the USA….by the way how far is Zambia from the US…Alaska to be precise

  7. Obama is over-ambitious…America was founded by the Republican constituition and if a black man is elected…our founding fathers wouldnt be happy…he has made a very good try though…but he is definately not going to 1600 Pennslyavania avenue why dont he try moving to Daniel Arapi Moi avenue in Nairobi so he can help his couson Laila Odinga to herd cattle

  8. My fellow Zambians, I am the “Maestro Hhehhehhehhe – LABELLED as a TRIBALIST BY a group of BEMBA-TRIBALISTS (mainly UNDEREDUCATED or Kaponyas) who are small DISTINCT group from the ORIGINAL NORMAL REAL BEMBA PEOPLE of Zambia, just because I am born Tonga and succesful”.
    I have now officially stated using the name on my username now.I have done so because LT seems to be a supporer of those who insults or atleast they have pressured him to be on their side.To this end, I am now offically a PF Supporter for Sata to destroy Zambia.I’ll change my username to Maestro Hhehhehhehhe after the October 30, 2008 elections. All POSTS under the name Maestro Hhehhehhehhe from today onwards wont be from me

  9. Zambia will only be rich if we start talking about big figures $103 Billion keep it up MR Editor. Next time go as far as $700 Billion

  10. #8 is right. Our Zambian press is terribly shallow. All they know is politics. They don’t have capacity to analyse things. They are not too different from ba kaponya. That’s why they can’t even discuss and analyse issue-based political campaigns. We all want our presidential hopefuls to debate issues that affect our people but the press back home don’t seem to have the capacity to lead the electorate in this area. They only print what a politician said and not try to discuss the matter against the issues facing electorates. Very shallow press. It’s a shame.

  11. #11 is a something I cannot describe at the moment, I am Christian. May need Jesus in your life. God blessed all mankind.

  12. #8& 18 spot on. these guys only think politics is the only news and just look at the daily mail for sure you will wonder what is happening to our journalism schools or are they all being trained at the tuntemba schools with fake lecturers. is Mpundu Mwape the only specialised journalist in zambia who can articulate agriculture issues well and teach even a novice like me one or two things just from watching his programs. can other journalists please emulate him and not subject us to this crap of reporting.

Comments are closed.

Read more

Local News

Discover more from Lusaka Times-Zambia's Leading Online News Site - LusakaTimes.com

Subscribe now to keep reading and get access to the full archive.

Continue reading