JOHANNESBURG – JSE-listed Resource Generation (Resgen) is looking for alternative funding for its Boikarabelo mine after being hit by unexpected delays in securing credit approval from one of its banks.
Company chairperson, Lulamile Xate, said in the 2017 annual report released on Friday that senior management had continued to engage with the lender in order to resolve the outstanding matters.
“We would not be serving our shareholders responsibly if we did not also start investigating alternatives to this proposed facility. Some progress has already been made in this regard and management is committed to keeping shareholders informed of further developments regarding project funding.”
Resgen, an emerging coal producer, has been working on funding and constructing the Boikarabelo project in Limpopo, which is scheduled to produce 6.5million tons of coal a year.
The company is hoping to supply the coal to state-owned Eskom.
Resgen in April announced that credit approval process for the Boikarabelo project had been delayed by a member of its lending syndicate, which requested further information before proceeding with their process.
The lender was concerned about the impact of the restructuring of Noble Group, a 13.7percent stakeholder in Resgen.