AUSTRALIA — Polymetals Resources Ltd (ASX: POL) has announced a significant milestone in its efforts to restart operations at the Endeavor silver, lead, and zinc mine near Cobar, New South Wales.
The company has secured a US$20 million (approximately $30 million) pre-payment/loan facility and favourable offtake terms for its future concentrate production.
The financing package, arranged with global commodity trader Ocean Partners UK Ltd, includes:
- A US$20 million revolving loan facility, replacing an earlier US$10 million pre-payment arrangement
- Favourable offtake terms for zinc and silver-lead concentrates, with deliveries expected to commence in the first half of 2025
This strategic partnership builds on a 20-year relationship between Polymetals and Ocean Partners, providing flexibility for Polymetals to pursue organic growth and exploration opportunities.
The secured funding will be applied to the Endeavor Mine restart, with key financial metrics including:
- Pre-production capital of $28 million
- Maximum cash drawdown of $30 million
- Pre-tax NPV8% of $414 million
- IRR of 345%
- Free cash flow of $609 million over the 10-year mine plan
- Average annual EBITDA of $89 million over the first 5 years
Polymetals has already commenced restart work at the mine and remains on track to deliver first concentrate output and cash flow during the first half of 2025.
Dave Sproule, Executive Chairman of Polymetals, expressed enthusiasm about the development, stating: “Completion of the project financing and offtake arrangement is the last hurdle in supporting the restart of Endeavor production.
“The strategic partnership with Ocean Partners builds upon an existing 20-year relationship between us, with Endeavor being a perfect fit for our respective capability and experience.”
The Endeavor Mine, acquired by Polymetals in 2023, is a significant underground silver, zinc, and lead operation located 40 kilometres north of Cobar.
It boasts substantial infrastructure, including:
- A fully equipped underground mine with a 7-kilometre decline and 300-metre shaft
- A 1.2 MTPA processing plant
- Extensive surface facilities and equipment
With a JORC Resource of 16.3 Mt @ 8% Zn, 4.5% Pb & 84g/t Ag, the mine presents compelling exploration potential likely to extend beyond the initial 10-year mine life.
As Polymetals moves forward with the Endeavor Mine restart, the company is positioning itself to become a significant producer in Australia’s rich Cobar Basin, with production targeted to begin in the first half of 2025.