Eagle Mountain advancing Oracle Ridge studies with $3m loan
Eagle Mountain can now proceed with technical studies relating to its Oracle Ridge copper mine in Arizona after securing a $3m loan from an entity associated with managing director Charles Bass.
The unsecured loan from Metech No2 Super Fund will support the company in reviewing the scale potential of the mine using various cut-off grades and assess advancements in equipment and process technologies that could lead to reduced operating costs and increased efficiencies.
Eagle Mountain (ASX:EM2) will also use the loan facility to investigate future mining and processing options which reflect the unique characteristics of the Oracle Ridge copper mine to enable an environmentally friendly and low emissions operation.
Technical studies and evaluations are already underway to establish base case operating scenarios.
Recent drilling at the project had delivered broad zones of copper mineralisation on the periphery of the resource, raising the likelihood of an increase in the high confidence Measured resource along with an overall increase in the volume of mineralisation.
The previously producing mine currently hosts a resource of 16.5Mt at 1.45% copper, 15.1 grams per tonne (g/t) silver and 0.19g/t gold, or contained Resources of 240,000t of copper, 8Moz silver and 102,000oz gold.
The loan from Metech No2 Super Fund has a maturity date of 31 December 2024 and attracts interest at a rate of 10% per annum.
Eagle Mountain may repay all or part of the Principal and interest at any time prior to the maturity while the lender has the option to convert all or part of the Principal and interest into ordinary shares in the company at any time up until 90 days before maturity.
Subject to shareholder approval, the conversion will be at a price being the greater of a 15% discount to the 15-day volume weighted average price of the company’s shares or a floor price of 14c.
If any portion of the loan is unpaid or converted prior to the day which is 90 days before maturity, the company may either repay the balance in cash or require conversion at a 12% discount to the VWAP.
This article was developed in collaboration with Eagle Mountain, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.