Emerging Copper ProducerHas anyone checked out ZMR-T? Not bad for .21 cents.
Zaruma arranges $22-million (U.S.) debt financing
2007-06-20 14:16 ET - News Release
Dr. Thomas Utter reports
ZARUMA RESOURCES ANNOUNCES LUZ DEL COBRE FINANCING
Zaruma Resources Inc., in recent discussions with Glencore International AG, learned that Glencore confirmed its intent to provide $22-million (U.S.) as debt financing for the capital requirements of the Luz del Cobre copper project, and also confirmed its interest in participating in the proposed copper exploration program on the 9,764-hectare property, which includes the Trion area, 1,000 metres to the west of Luz del Cobre, where a previously undefined oxide copper target zone has been delineated. In consideration of Glencore's provision of the loan, and financing the exploration and development of Trion, Glencore shall have the right to offtake 100 per cent of all base metal production from Luz del Cobre and Trion, based on London Metal Exchange market prices.
Zaruma is committed to finance any capital cost overruns and will source the remaining estimated amount of the project cost, estimated to be $3-million (U.S.).
The technical report on the project, in compliance with NI 43-101 standards, was filed in November, 2006, indicating estimated reserves of 4.4 million tonnes of ore with an average grade of 1 per cent Cu, and based on producing 15 million pounds of copper per year, the pretax net operational cash flow was estimated to average $19.4-million (U.S.) per year. Adjusting the projected price of copper to a more recent trailing average price over 24 months of $2.51 (U.S.) would add over $4-million the annual cash flow.
The project capital cost is currently estimated at $25-million (U.S.), and the estimated time to first production is 12 to 15 months from the date an engineering, procurement and construction management contract is awarded. Cost estimates will be more accurately defined as the engineering and procurement work proceeds.
The selection of the EPCM contractor will be done while the legal agreements on the financing are being completed.
At today's annual meeting of shareholders, the directors proposed by management for election, Peter Lorange, Michael Power, Michael Richings, Thomas Utter and Frank van de Water were re-elected.