China stainless steel mogul fights to avoid a second collapse
A debt crisis is threatening the future of one of the world’s top stainless steel producers, Jiangsu Delong Nickel Industry.
Perceiving a cloudy future for world markets, Ivanhoe Mines (NYSE:IVN) announced that they had negotiated an additional US$1.8 billion bridge financing for Oyu Tolgoi.
“The facility, a precautionary response to volatility in the project finance and corporate debt markets stemming from recent events in Europe, could be used if there is a delay in completing and gaining approvals for the long-term project-finance package,” said the company in a statement on Wednesday.
“The proposed bridging facility approved by the Ivanhoe Mines board remains subject to approvals by Rio Tinto and the bank credit committee, and completion of final documentation.”
The company says financing will be provided by a major international bank.
Ivanhoe’s stock slipped two percent on Wednesday to $18.60 a share.
The company says that the construction of Oyu Tolgoi is 70% complete.
“Initial production from the Southern Oyu open-pit mine is expected in mid-2012; commercial production of copper-gold-silver concentrate is projected to begin in the first half of 2013.”
Oyu Tolgoi is the world’s largest copper-gold project, and it contains approximately 81 billion pounds of copper and 46 million ounces of gold in measured, indicated and inferred resources.
