Australian Bauxite secures A$8 million investment from Nobel Resources

Australian Bauxite had secured a mining lease last month for the Bald Hill project in Tasmania and now they have even secured an investment of A$ 8 million from a commodities group named Noble Resources.

The agreement finalized between the two parties ensures Australian Bauxite receives A$ 6 million in terms of project finance and an additional A$2 million as stand-by facilities which is to be used in case of project expansions. In return, Noble would earn exclusive marketing rights for the entire Bald Hill project.

The loan repayment needs to be made two years after the first drawdown which is expected to be in December of this year as around A$1 million is needed as the project goes into construction phase. The interest would be paid on the outstanding balance at a rate of 8.75% a year and the Australian Bauxite is offering their Tasmanian assets as security.

Nobel, that has a proven track record of helping independent miners in Australia, has undertaken the task being the marketing agent for all the products developed in the Bald Hill project as well as agreeing to buy 50% of the products over the first four years at a pre-decided fixed price.

The initial product capacity for the project is estimated at 500,000 tons/year of direct-shipping-ore quality bauxite which is expected to rise to about two million tons/year over the next two years.