Australian Pacific Coal, Ltd. (APC) has received a non-binding Letter of Intent (LoI) from a top 3 global commodities trading firm for up to $50 million (approximately A$75 million) in debt funding to enable the restart of Dartbrook underground coal mine. The funds will enable the acquisition of critical plant and equipment and commencement of mining operations in Q4 of 2023

APC has previously said the Dartbrook project would require up to A$120 million ($77 million) for capex and working capital to enable mining operations to recommence. To date, AQC has provided approximately A$20 million ($13 million) of the A$120 million via loans to the Dartbrook Joint Venture. A further A$75 million ($48 million) is required to fund equipment purchases and refurbishment activities to achieve first coal, and initial working capital requirements are estimated at A$20-A$25 million.

AQC is targeting completion of loan documentation and initial drawdown of funds within 4-6 weeks, subject to final negotiations. The process to raise additional funding to cover working capital requirements and reimbursement of AQC loans to the project is also well advanced.

“The receipt of a non-binding LoI… in this tough capital market environment is a clear signal that the Dartbrook project presents an attractive and compelling investment for lenders and traders alike,” said Australian Pacific Coal’s Interim CEO, Ayten Saridas. “While we have had to rely on our own balance sheet to fund the restart activities to date, it has enabled us to significantly de-risk the project and reflects positively on our progress. In particular, the de-watering of the Hunter Tunnel has been successfully delivered safely and on time.” She said the company has completed the Operating Joint Venture Agreement and developed a revised mine plan which will result in improved yield potential and better product mix.