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Paringa Resources Update on Hartshorne Mining Group

Coal News - Published on Fri, 17 Jan 2020

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Paringa Resources Limited said that its 100% owned subsidiary, Hartshorne Mining Group LLC, has retained FTI Consulting Inc to perform a review of Hartshorne’s near-term financial outlook and operational performance, including an assessment of additional financing required for operational needs. The immediate priority of FTI and the Company is to explore all opportunities to maximise the value of Hartshorne and the Poplar Grove mine, either through additional funding to finance the continuation of operating activities at the Project or by a potential trade sale.

The Company’s focus has been on ramping up mining operations at the Project. Operational and technical challenges to-date have resulted in production levels yet to reach expected volumes. Drilling is underway to provide greater confidence on near-term production.

In order to maintain Hartshorne’s cash position as it continues to ramp-up its operations, and after consultation with the agent for Hartshorne’s secured lenders, Tribeca Global Resources Credit Pty Ltd, Hartshorne has decided to defer payment of the December 31, 2019 quarterly interest and fees required under its term loan facility, totalling approximately USD 1.5 million. This deferral has triggered an event of default under the term loan facility which gives Tribeca the right to demand immediate full repayment of the term loan facility. Tribeca has issued a letter to Hartshorne and the Company (as a guarantor of Hartshorne’s obligations under the term loan facility) that notifies the existence of the event of default and reserving its rights in respect of such default.

Mining operations have recommenced following the scheduled Christmas and New Year break and the Company and FTI will continue to work closely with Hartshorne’s lenders, employees, customers, and suppliers to optimise value for all stakeholders. The Company’s securities will remain suspended from trading until the Company can make further announcements on the above.

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Posted By : Rabi Wangkhem on Fri, 17 Jan 2020
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