Author: Fuel Integrated

New $300 million credit facility with Development Bank of Kazakhstan and PXF update

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces that it has reached agreement on a new $300 million credit facility with the Development Bank of Kazakhstan JSC (“DBK”) which is scheduled to be signed on 14 December 2016.

The DBK facility will finance the completion of the Aktogay project which began commissioning of its main sulphide concentrator on 6 December 2016. The facility is expected to be fully drawn before the year-end and extends for a term of 8.5 years until final maturity in June 2025. The loan is repayable in instalments with the first repayment due in June 2018, followed by semi-annual repayments in May and November of each year from 2019 until 2024 and a final repayment in June 2025. The facility bears an interest rate of US dollar LIBOR +4.50% and contains a financial covenant which is the same as the Group’s loan facilities with the China Development Bank, based on a ratio of total liabilities to total assets, with adjustments to mitigate the translation impact of movements in the US dollar/tenge exchange rate.

The Group also announces that an increased commitment by ING Bank N.V. in the Pre-export finance facility (“PXF”) has been agreed for an additional $50 million under the accordion feature. The additional commitment is expected to be drawn before the year-end. The total amount outstanding under the PXF as at 31 December 2016, including the additional drawing, is expected to be approximately $283 million. As previously announced, the Group intends to resume discussions with the PXF bank syndicate over a longer-term refinancing of the facility, after release of its 2016 financial statements.

Following the previously announced waiver obtained from the PXF lenders, the Group has also received a waiver from Caterpillar Financial Services (UK) Limited in relation to testing of the Net Debt to EBITDA covenant on 31 December 2016 under the $50 million CAT facility.

Andrew Southam, Chief Financial Officer of KAZ Minerals, said: “We are pleased to have secured a new, long-term facility of $300 million from the Development Bank of Kazakhstan and to have increased ING Bank N.V.’s participation in the PXF facility by $50 million, ahead of a planned refinancing in the first half of 2017. These transactions demonstrate the Group’s ability to access diversified sources of finance and the strong support KAZ Minerals enjoys from its lenders.”

Please follow the link to read the full announcement.

 

Holding(s) in Company

Aktogay Project Update

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces that the testing and commissioning of the main Aktogay sulphide concentrator has commenced today. Production of saleable copper concentrate from sulphide ore is expected by the end of the first quarter of 2017. Production guidance for Aktogay in 2017 will be announced with the Group’s full year results on 23 February 2017.

The Aktogay project budget has been reviewed and reduced by $100 million to $2,100 million. The saving has been achieved through faster than anticipated progress in construction of the concentrator, a partial release of contingency and from the continued benefit of a local supplier strategy and sustained weak tenge.

The timing of the remaining capital payments has been updated, with certain payments previously expected in late 2016 now anticipated in early 2017 and $70 million relating to the expansion of oxide ore heap leach cells deferred to 2018.

The resulting capital expenditure profile for the project is expected to be approximately $100 million in H2 2016, $240 million in 2017 and $370 million in 2018. The $370 million guidance for 2018 includes $300 million of payments relating to work in 2016 and 2017 that was deferred under an agreement with the principal construction contractor in November 2015.

Oleg Novachuk, Chief Executive, said: “We are happy to be able to announce the start of commissioning activities at the Aktogay sulphide concentrator and a further reduction of $100 million in the project budget. We are now focused on ramping up production at Aktogay and Bozshakol to deliver industry-leading copper production growth.”

PLEASE FOLLOW THE LINK TO DOWNLOAD THE FULL ANNOUNCEMENT

 

Total Voting Rights

In conformity with the Disclosure and Transparency Rules (“the Rules”), the Company hereby notifies the market of the following:

At the date of this announcement, the issued capital of the Company comprises 458,379,033 ordinary shares.

The Company currently holds 11,690,932 ordinary shares in treasury and therefore the issued share capital of the Company which carries voting rights of one vote per share comprises 446,688,101 ordinary shares (excluding treasury shares).

The above figure of 446,688,101 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Rules.

For further information, please contact:

Susanna Freeman
Company Secretary
Tel: + 44 (0)20 7901 7826

PLEASE FOLLOW THE LINK TO DOWNLOAD THE FULL ANNOUNCEMENT

 

Notification of Transactions of Directors, Persons Discharging Managerial Responsibility or Connected Persons

Total Voting Rights

In conformity with the Disclosure and Transparency Rules (“the Rules”), the Company notifies the market of the following:

At the date of this announcement, the issued capital of the Company comprises 458,379,033 ordinary shares.

The Company currently holds 11,701,830 ordinary shares in treasury and the issued share capital of the Company which carries voting rights of one vote per share comprises 446,677,203 ordinary shares (excluding treasury shares).

The above figure of 446,677,203 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Rules.

For further information, please contact:

Susanna Freeman
Company Secretary
Tel: + 44 (0)20 7901 7826

PLEASE FOLLOW THE LINK TO DOWNLOAD THE FULL ANNOUNCEMENT

 

Pre-Export Finance Facility Covenant Waiver

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces that a waiver of the Net Debt to EBITDA financial covenant in the Group’s PXF facility due to be tested as at 31 December 2016 has been approved. The covenant is next due to be tested as at 30 June 2017.

The Group continues to enjoy strong support from its lenders and plans to resume discussions with the PXF bank syndicate over a longer term refinancing of the facility in early 2017, after release of the 2016 financial statements.

A similar waiver request has also been issued to Caterpillar Financial Services (UK) Limited in respect of the Group’s $50 million revolving credit facility and a formal response is expected shortly.

Q3 Production Report 2016 and IMS

KAZ MINERALS GROUP Production Report for nine months and THE third QUARTER Ended 30 september 2016 and interim management statement 

  • Copper cathode equivalent production1 in Q3 of 44.5 kt (Q2: 31.1 kt)
    • Production growth continues as Bozshakol and Aktogay oxide ramp up
    • Group guidance for 2016 maintained at 135-145 kt copper cathode equivalent (FY 2015: 81.1 kt)
  • Bozshakol more than doubles copper output in Q3 to 16.9 kt (Q2: 7.5 kt)
    • Ore throughput has steadily increased in Q3
    • Concentrator has now operated at ore throughput levels above 60% for three months, declared commercial today
  • Aktogay oxide increases copper cathode output by 69% to 6.6 kt in Q3 (Q2: 3.9 kt)
    • Oxide production benefited from seasonally warmer conditions in the third quarter
    • On track to produce around 15 kt in 2016, in line with guidance
  • By-product output on track to achieve full year guidance ranges
    • Strong Q3 gold output of 40.9 koz supported by Bozymchak operating consistently at design capacity and a temporarily high grade at Bozshakol
    • Silver bar output 806 koz in Q3 (Q2: 679 koz) assisted by a release of work in progress
    • Full year silver production expected to exceed top end of 2,500-2,750 koz guidance due to lower than expected grade decline in the East Region in 2016
    • Zinc in concentrate output of 16.6 kt in Q3, 56.2 kt in the period to 30 September 2016, on track for full year guidance of 70-75 kt
  • Net debt of $2,590 million at 30 September 2016
    • Gross liquid funds of $872 million
  1. The Group’s finished goods “equivalent” production includes both finished metals produced and the finished metal equivalent of concentrate sold in the period.

Oleg Novachuk, Chief Executive, said: “KAZ Minerals continues to deliver sector-leading production growth, with our copper output growing by 66% in the first nine months of this year. Given the progress made in ramping up Bozshakol, our first major growth project, we have declared it a commercially producing asset from today. We are also making good progress on the construction of the Aktogay sulphide project, which will deliver the next phase of our production growth in 2017.”

Please follow the link to read the full announcement.

 

Notification of Transactions of Directors, Persons Discharging Managerial Responsibility or Connected Persons

Total Voting Rights

In conformity with the Disclosure and Transparency Rules (“the Rules”), the Company notifies the market of the following:

At the date of this announcement, the issued capital of the Company comprises 458,379,033 ordinary shares.

The Company currently holds 11,701,830 ordinary shares in treasury and the issued share capital of the Company which carries voting rights of one vote per share comprises 446,677,203 ordinary shares (excluding treasury shares).

The above figure of 446,677,203 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Rules.

For further information, please contact:

Susanna Freeman
Company Secretary
Tel: + 44 (0)20 7901 7826

PLEASE FOLLOW THE LINK TO DOWNLOAD THE FULL ANNOUNCEMENT