There hasn’t been any good news coming out of Greenland since they stopped clubbing seals and harpooning whales, however it looks likeIronBark Zinc Limited(ASX:IBG)has receivedpreliminary approval for a senior debt facility of up to US$657 millionfrom US based Exim bank for their Citronen Project (figure 6) in northern Greenland.
The interest rate, at 2.2% or thereabouts, is attractive, however the devil, as usual, will be in the detail (including coming up with the required equity component).
The company has engaged London based Bacchus Capital to source potential equity investment.
The project has a reserve of 48.8Mt @ 5.1% Zn equiv (4.8% Zn and 0.5% Pb) from a reasonably large resource inventory (table 1).A feasibility study was completed in September 2017 with the financial metrics having improved due to the rise in the zinc price (currently around US$3,300/tonne) – table 2.I think this is an impressive deal for IBG even though there are a lot of hurdles to get over to satisfy the lenders.
The deal is all the more impressive as this isn’t a particularly high-grade resource and is located in a fairly inhospitable part of Greenland where even polar bears have been seen wearing golden goose jackets in the extreme cold.
Transport can also be limited to riding on floating ice over October through to March. It also goes to show the lengths that the US government will go to in its pursuit of long-term supplies of critical metals such as zinc.
This is the first deal under the US Government’s 402A program design to combat China’s Belt and Road Initiative.
The deal may represent the start of a titanic battle for worldwide resources and Greenland looks like the beach head.
WithGreenland Minerals Ltd(ASX:GGG)Kvanefjeld giant rare earth-uranium projectgathering dust after the government changed the legislation to ban mining of any ore contained over 100ppm uranium, this deal may well give the country a much-needed shot in the arm with the help of Uncle Sam.
Maybe Greenland is the promised land after all?
(20min delay)