New $600 million debt facility with Development Bank of Kazakhstan

KAZ Minerals PLC (“KAZ Minerals” or “the Group”) announces that it has signed a $600 million credit facility with the Development Bank of Kazakhstan JSC (“DBK”). The new DBK facility will provide financing for the Group’s Aktogay expansion project, which is currently in construction and will double the processing capacity of the Aktogay mine. The project was approved by the Board in December 2017 and is scheduled to be completed by the end of 2021.

The facility is expected to be drawn in 2019 and 2020 and extends for a term of 15 years until final maturity in 2034. The loan is repayable in instalments with the first repayment due three years after the date of first drawing, followed by semi-annual repayments in May and November of each year from November 2022 until the final repayment in 2034. The first drawing under the loan is expected during the third quarter of 2019.

The facility bears an interest rate of US dollar LIBOR + 3.90% and contains a financial covenant which is the same as the Group’s existing facilities with DBK and the China Development Bank based on a ratio of total liabilities to total assets. 

John Hadfield, Chief Financial Officer, said: “The new $600 million debt facility with DBK provides funding for the second sulphide concentrator at Aktogay, where construction is progressing well and is on track to deliver near-term copper production growth from 2021. The Aktogay expansion is a low risk, brownfield development that is expected to increase cash flow and establish a stronger platform to deliver the Baimskaya copper project in the Chukotka region of Russia. KAZ Minerals has an industry leading pipeline of value-accretive projects which will sustain production growth over the next decade, when the copper market is forecast to enter a period of significant supply deficit.”

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