Romarco Minerals has renegotiated a number of key contracts to re-align equipment deliveries for the development of the Haile Gold Mine in South Carolina.
Last month, Romarco received a schedule from the US Army Corps of Engineers for completing the Environmental Impact Statement for the Federal 404 Wetlands permit. The schedule gives the decision date for the permit as 16 August 2013, somewhat later than Romarco had anticipated.
Delivery of Romarco's Caterpillar mobile mine equipment for the project (currently held in inventory by the local CAT dealer, Blanchard Machinery Company) was originally scheduled for 31 March 2013 but will now be postponed to align with the expected start of construction. Romarco will pay BMC an additional holding cost of $30,000 per month for this facility.
Similarly, Romarco has agreed with local Hitachi shovel dealer, Flint Holdings, to align delivery with the expected start of construction. FH anticipates receiving the shovel in December 2012 and will maintain it in its inventory until delivered to Haile.
At that time, Romarco will pay FH a monthly holding cost of approximately $11,000 and make monthly down payment instalments of approximately $43,000. This agreement maintains the previously agreed pricing, ensures timely delivery of the shovel, and allows Romarco to defer the majority of the payment, approximately $2.5 million, until the equipment is delivered to Haile.
The manufacturer of the SAG and secondary ball grinding mills has indicated it will re-align delivery and final payments by three to six months. This will defer the approximate $5 million final payment over the first and second quarters of 2013.
"By realigning our equipment payments to coincide with the EIS schedule, we have maintained our financial flexibility while ensuring we will have our mobile mining fleet available when we are ready to start construction and mine development,” said Diane R. Garrett, President and CEO of Romarco.
“We are extremely pleased with the support we have received from our equipment suppliers,” she concluded.
