The London-listed miner started talks with its banks earlier this year after the confiscation of a consignment of its diamonds by the government in Tanzania and a labour strike at its South African mines put it at risk of falling short of its loan obligations.
Tanzania accused Petra of under declaring the value of the diamonds, in a move that was seen as part of the country’s crackdown on the mining industry to reap more revenue from its minerals.
Petra has denied any wrongdoing and has said the consignment has not been released.
The talks with banks centred on the debt arrangement relating to Petra’s EBITDA for December 2017, which has now been waived, and to the covenant concerning its EBITDA for June and December this year, which have been reset under the deal.
The new debt covenants struck with Absa Bank, Nedbank, Firstrand Bank and Investec Asset Management allow for the interest rate on the loans to increase by up to two percent depending on by how much the ratio of Petra’s net debt to consolidated EBITDA is breached.
“The finalization of this agreement with our Lender Group validates its support of Petra’s business and strategy, as we negotiate this final stretch of our expansion programs,” Chief Executive Officer Johan Dippenaar (pictured) said in the statement.
Meanwhile, Acacia Mining's gold production for quarter one (Q1) this year in Tanzania has indicated a 55 per cent decrease on Q1 2017, primarily driven by the move to reduce operations at Bulyanhulu and to stockpile processing at Buzwagi.
Gold ounces sold for the quarter of 116,955 ounces were slightly below gold produced for the quarter as a result of the timing of shipments. At North Mara, gold production for the quarter of 76,769 ounces was, as expected, 20 per cent lower than Q1 2017’s strong, grade-driven performance of 96,468 ounces.
This was primarily due to lower head grade, driven by the underground mine grade of seven grams per tonne being 28 per cent lower than the prior year period as a result of mining taking place in the lower-grade west zone of the Gokona Underground in Tanzania.
At Buzwagi, gold production of 35,685 ounces for Q1 2018 was 41 per cent lower than in Q1 2017 as a result of production now being derived from lower grade ore stockpiles due to the effective completion of the open pit. At Bulyanhulu, gold production for the quarter amounted to 8,527 ounces, 87 per cent below Q1 2017.
During the quarter all production came from the retreatment of tailings as a result of the underground mine in Tanzania being placed on reduced operations in late 2017.
“Acacia Mining continued to demonstrate resilient operating performance and delivered solid production of 120,981 ounces of gold in the first quarter across the group, which sets us in good stead to deliver against our full year guidance of 435,000 - 475,000 ounces,” says Peter Geleta, Interim CEO.
“All three of our operations delivered in line with their respective mine plans and we were pleased to record an increase in our cash balance to US$107 million, driven by the sale of a non-core royalty that completed in January 2018, which helped to further stabilise our balance sheet.”
"The cash balance as at March 31, 2018, amounted to approximately US$107 million and increased by US$26 million during the quarter, with net cash increasing by US$40 million to approximately US$50 million at period end.
"During the quarter we repaid a further US$14 million of the CIL debt facility and received US$45 million from the sale of a non-core royalty, announced in December 2017," concludes Geleta.
_0.jpg?itok=QU87XW8D){kind=tracking}
.jpeg?itok=vCj6bCRe)
