Orion Minerals Ltd (ASX:ORN, JSE:ORN) has issued the first drawdown notices in relation to ZAR370 million (~A$30 million) of committed funding for its Prieska Copper-Zinc Project in South Africa, in what is described as a “significant milestone” for the company,
The company has satisfied several substantive conditions, finalising funding arrangements with the Industrial Development Corporation of South Africa Limited (IDC) and Triple Flag Precious Metals Corp., enabling the drawdown process to commence.
Drawdown of the ZAR250 million (~A$20 million) convertible loan will be in tranches and will be pro-rata matched by the drawdown requests that Orion will make under the A$10 million Triple Flag funding arrangement.
Both the IDC convertible loan and Triple Flag arrangement form part of Orion’s broader funding strategy outlined in recent months that will underpin the near-term development of the Prieska Project along with the Okiep Copper Project, both in the Northern Cape Province.
“Another significant milestone”
Orion managing director and CEO Errol Smart said: “This marks another significant milestone as we systematically check the boxes towards the development of our two key base metal hubs in South Africa’s Northern Cape.
“After an exhaustive due diligence process, we have now satisfied the substantive conditions for the first two legs of our funding strategy – effectively unlocking ZAR370 million worth of project development funding for the Prieska Project.
“This will allow us to accelerate pre-development mine works, including trial mining in the upper levels of the mine and construction and commissioning of mine dewatering installations.”
“The IDC/Triple Flag funding complements the third leg of our funding strategy, announced last quarter, which comprises the equity placement and associated options package underpinned by Clover Alloys and existing shareholders Tembo Capital and Delphi Group.
“In combination, this multi-faceted funding package puts Orion in a very strong position to execute our development strategy and prepare the company to make the transition to a developer and ultimately an operating mining company.”
Forward plan
As part of its strategic funding package, Orion is transitioning its flagship Prieska Project to the mine development and construction phase.
In March 2023, the company launched an A$13 million two-tranche share placement that introduced a new cornerstone investor, Clover Alloys.
Clover Alloys, renowned for its significant mine development and operational expertise, is expected to be invaluable in Orion’s development of its Prieska Project and Okiep Project.
Notably, Orion has also received support from existing long-term shareholders, the Delphi Group and Tembo Capital Mining Fund II LP, who participated in the recent placement.
