Gunnison Copper Corp. Secures Flexible Financing to Advance Project Development and Growth
- Gunnison Copper Corp. secures flexible financing through a new credit agreement, enhancing debt management and project development.
- The agreement allows for converting up to $6.25 million of principal into equity, strengthening Gunnison's balance sheet.
- Gunnison's projects, including the flagship project, aim to meet growing copper demand, particularly in renewable energy sectors.
Gunnison Copper Secures Flexible Financing to Propel Project Development
Gunnison Copper Corp., a key player in the copper mining sector based in Phoenix, Arizona, announces the successful completion of the Second Amended and Restated Credit Agreement (Second ARCA) with Nebari Natural Resources Credit Fund I LP. This new agreement modifies the existing financial structure established in December 2021, providing Gunnison Copper with greater flexibility in managing its debt obligations. Notably, the agreement suspends principal amortization from February 1, 2025, until January 1, 2026, allowing the company to allocate resources more strategically towards its operational and developmental goals.
The Second ARCA introduces a potential conversion of up to US$6.25 million of the principal into equity at a specified price of US$0.2097. This provision could strengthen the company's balance sheet and provide additional capital for advancing the Gunnison Copper Project, which controls a substantial mineral resource of over 831 million tons with a copper grade of 0.31%. The project's preliminary economic assessment highlights its promising potential, showcasing a net present value (NPV) of $1.3 billion and an internal rate of return (IRR) of 20.9%, reflecting a payback period of just 4.1 years. The flexibility afforded by the new credit agreement is likely to enhance Gunnison's ability to meet its financial commitments while focusing on the project's development.
Furthermore, the amended agreement includes provisions for utilizing proceeds from 48C tax credits to repay part of the principal, as well as options for refinancing to extend the maturity date. With all conditions for the amendments met, including approvals from the Toronto Stock Exchange and Greenstone Resources L.P., Gunnison Copper is well-positioned to navigate the evolving landscape of the copper industry. The company remains focused on its flagship project in the Cochise Mining District, which is expected to contribute significantly to the growing demand for copper in various sectors, especially in renewable energy and electric vehicle manufacturing.
In addition to its flagship project, Gunnison Copper is advancing the Johnson Camp Asset, which is currently under construction and fully funded by Nuton LLC. This asset is anticipated to bolster the company's production capacity and further solidify its standing within the Southern Arizona Copper Belt. As the company progresses, the enhanced financial flexibility from the Second ARCA will be crucial in executing its strategic initiatives and addressing the increasing global demand for copper.
