Baikal Mining Company, a part of USM Holding, and state banks Gazprombank, Sberbank, and VEB.rf have signed a contract to provide an up to $1.79-billion syndicated loan for development of the Udokan copper deposit, they said in a joint statement on July 10.
Under an earlier agreement, VEB.rf, Gazprombank, and Sberbank agreed to finance up to 70% of a $2.9-billion cost of the development project’s first stage.
“Gazprombank is the organizer of financing and a financial consultant of the deal, which is also one of the creditors providing up to $650 million under the deal and attracting external foreign financing,” the statement read.
Sberbank also plans to provide up to $650 million of financing, while VEB.rf is to issue up to $490 million.
In February Baikal Mining Company said that it would spend the 12-year syndicated loan to finance investment and operating costs, including construction works and procurement of equipment. The shareholders of Baikal Mining Company have already invested 28.5 billion rubles and they will cover at least 30% of the project’s total cost, the company also said.
The Udokan deposit is one of the world’s largest copper deposits located near the Baikal Lake. The deposit’s mineral resources are estimated at 2.3 billion tons with an average copper content of 1.06%, and copper of 24.6 million tons under JORC. The first stage is planned to be launched in 2022. (Prime/Ukrainian metal)