ResGen finds Noble funding

RESOURCE Generation has established a strategic partnership with Noble Group, Asia’s largest diversified commodities trading company, to develop the Boikarabelo coal project in South Africa's Waterberg coalfield.
ResGen finds Noble funding ResGen finds Noble funding ResGen finds Noble funding ResGen finds Noble funding ResGen finds Noble funding

The Boikarabelo coal project near Botswana, map courtesy of ResGen.

Staff Reporter

Through the agreement, Noble would acquire a 7.5% shareholding in ResGen for $A8.5 million ($US8.9 million) at 40c a share for a total of 21.35 million shares.

The partnership also increases Noble's offtake from the Boikarabelo project which is one of South Africa’s largest remaining coal deposits.

It could increase tonnage to as much as 2.5 million tons per annum over a 35-year period.

“This agreement gives Resource Generation a strong strategic partner as we continue with the construction of Boikarabelo’s infrastructure,” ResGen managing director Paul Jury said.

“Noble Group’s investment and loan facility and its increased offtake commitment demonstrate the group’s confidence in the mine’s potential.

“They also provide a platform for continuing to secure additional funding for the project.”

In addition, Noble has agreed to provide ResGen with a secured loan facility of up to $US123 million on normal commercial terms.

Noble was also appointed the project's supply chain manager and exclusive marketing agent.

The news comes after ResGen last month announced it was considering alternative funding after it received credit-approved offers of project finance from its current financier that deviated from an agreed term sheet.

The Boikarabelo project is expected to produce an initial 6Mtpa, split equally between export and domestic coal.

It has probable reserves of 744.8Mt of coal on 35% of the company’s tenements.

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