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Trafigura arm extends $20 mln to Mawson West's Congo copper mine

Published 2016-03-02, 06:15 p/m
© Reuters. Trafigura arm extends $20 mln to Mawson West's Congo copper mine
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March 2 (Reuters) - Global commodity merchant Trafigura's
investment arm will lend $20 million to an Africa-based copper
mine owned by Mawson West Ltd MWE.TO , as the Australian miner
prepares to shutter a copper operation in an effort to deal with
sinking metal prices.
Galena, Trafigura's private equity arm, is the largest
shareholder in Mawson West and will provide the loan to the
company's unit, Anvil Mining Congo SA.
Mawson West also said on Wednesday that it would put its
mining operations at the Kapulo mine in Democratic Republic of
Congo on care and maintenance by the end of this month.
Copper prices CMCU3 are languishing at six-and-a-half year
lows amid concerns about waning demand from China, the world's
top consumer of industrial metals.
The alternative to the financing would more than likely be
insolvency proceedings, acting Chief Executive Anthony Lloyd
said in a statement.
"At current prices, the company was producing at levels
insufficient to cover its operational and financial
obligations."
The company also said it was facing difficulties in
satisfying its payables in a timely manner.
Mawson West also amended its prepayment facility with
Trafigura by which payments due will cease until the mining
operations resumed.
Galena will get warrants giving it the right to acquire up
to 2.74 billion of Mawson West shares at C$0.01 per share until
Dec. 31, 2017.

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