marc florys funding comments

AIM cash for Perkoa
Thursday, March 09, 2006
Ben Sharples

BUDDING zinc producer AIM Resources has raised $A5.6 million from UK-based institutions, with the funds being allocated towards progressing its Perkoa zinc project in Burkina Faso and drilling the Mumbwa joint venture with BHP Billiton.

AIM Resources' Perkoa zinc-silver deposit in Burkina Faso

AIM issued 60 million shares at 4 pence through its London-based stockbroker Seymour Pierce to raise the equity.

AIM managing director Marc Flory told MiningNews.net the raising was interim funding to make sure the company didn't run out of funds if project financing took longer than expected.

"We're speaking to a number of smelters and traders at the moment, there are a number of ways of financing," he said. "I think it'll be a combination of lending against offtake, and debt/equity, we're going through those dynamics at the moment."

"The smelters are prepared to do all sorts of things including lending against our future concentrate flow, a number that we're speaking to are bringing that into the equation.

"Then you've got engineering companies that will build the plant…we're looking at three at the moment, who will also bring self funding."

Flory anticipated project funding would be wrapped up by June with first production flagged for the end of 2007.

A bankable feasibility study indicated the company's flagship Perkoa project would cost in the order of $US72.5 million ($A98.8 million) to develop and would produce around 116,000 tonnes of zinc in concentrate per annum over a 14-year mine life.

The project has a net present value of $147.7 million and an internal rate of return of 43.5%, with cash operating costs of $53.50 per tonne, equating to $0.18 per pound of zinc produced.

Perkoa has a proved and probable reserve of 6.27Mt at 14.5% zinc.

AIM said previously that project financing should be completed by the first quarter of 2006 with Barclays Capital charged as the company's debt finance advisors. The company expects to start project development in the second quarter of this year.

Elsewhere, AIM and JV partner BHPB are planning a diamond drill campaign on their Mumbwa copper-gold project in Zambia, which is expected to kick off around April/May.

Shares in AIM hit a 52-week low of 4.5c in April before gaining ground to hit a 52-week high of 12c on Tuesday. The stock remained unchanged during morning trade at 11c.



Thanks MiningNews.net

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