Cokal Limited (ASX:CKA) Secures US$15 Million Debt Funding
Strategic Funding
Cokal Limited (ASX:CKA) has secured US$15 million in strategic debt funding from long-term supportive shareholder Eddie Chin via International Commodity Trade Pte Ltd. The funds will be utilised to increase metallurgical coal production at the BBM mine through investment in capital expenditure to develop mining operations and enhance transport infrastructure capacity.
Operational Updates
The additional funding will enable operational efficiencies, resulting in lower costs for saleable metallurgical coal production per tonne. Cokal has also resumed domestic coal shipments, delivering 7,500 MT to Risun after a pause due to market challenges. The company remains confident in executing further domestic shipments as metallurgical coal prices recover.
Termination of Agreements
Cokal has terminated all agreements with Cratus after the terms were not met to Cokal’s satisfaction. With the new funding, Cokal will continue its infrastructure development and prepare to ramp up coal production and sales as market conditions improve.
Executive Comments
Cokal’s Chairman, Mr Domenic Martino, stated, “This strategic funding facility cements Cokal’s ability to complete its initial infrastructure requirements notwithstanding that Metallurgical coal prices are at a low point. This non dilutive form of financing is beneficial to shareholders as it is non dilutive, allowing existing shareholders to share in the upside of a better coal price and substantially higher volumes of coal production and sales as prices recover.”
Cokal’s CEO, Mr Karan Bangur, commented, “This strategic funding commitment by ICT underpins their confidence in Cokal and the BBM and TBAR projects. They commenced their journey with Cokal with the view to establishing two world class metallurgical coal projects. The infrastructure development will eventually service both the BBM and TBAR projects.”
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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