Indochine renegotiates finance

INDOCHINE Mining has renegotiated its existing finance package to provide immediate additional funding of $1.15 million to allow the company to continue to operate.
Indochine renegotiates finance Indochine renegotiates finance Indochine renegotiates finance Indochine renegotiates finance Indochine renegotiates finance

The explorer entered into discussions with its existing secured lender as it prepared to advance ongoing talks with potential parties interested in investing in the flagship high-grade Mt Kare gold project in Papua New Guinea.

In a statement to the market, Indochine said discussions included a request to extend and vary the existing facility.

The terms of the facility will give Indochine total secured debt of $3.05 million, while the repayment date for both drawn down amounts and new funding has been extended to December 31, subject to monthly reviews.

Under the deal, the annual interest rate has been reduced to 25% per annum.

Indochine has agreed to provide a first ranking general security agreement over all of the company's assets, a first ranking fixed and floating charge over all assets owned by subsidiary Summit Development and a first ranking mortgage over Summit's tenement lease in PNG.

Indochine chairman Dermott McVeigh said: "With the immediate funding package in place, discussions are progressing with the company's existing shareholders and potential investors to seek new equity funding that will allow the company to continue to develop the Mt Kare project in PNG.

"The company is encouraged by these discussions and will continue to engage with potential equity providers over the coming days to progress the company's equity raising efforts.

"It is the company's intention to commence development of an exploration adit as soon as funding is available from the prospective capital raising.

"The development adit will allow for underground drilling of higher grade zones in order to accelerate the feasibility study of these areas."

The Mt Kare deposit lies 15km southwest of Barrick Gold's massive Porgera mine.

Resources at the site stand at 43 million tonnes at 1.5 grams per tonne gold for 2.1 million ounces of gold and 18Moz of silver.

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