CUDECO'S TOTAL OUTLAY AT ROCKLAND'S HITS $430M
Written on the 16 March 2015 by Nick Nichols
COPPER miner CuDeco (ASX:CDU) has clocked up $430 million in expenditure for its Rocklands project so far, spending about $60 million of that in the last six months alone.
CuDeco says it has lifted its mine development outlays by $26 million to $176 million in the six months to the end of December, while the bill for plant and equipment has surged $35 million to $254 million.
The latest lift in expenditure highlights the increased investment by the company to bring its Rocklands mine, in north-west Queensland, to full production - a process which is being increasingly backed by CuDeco's key Chinese shareholders.
While CuDeco had just $7.5 million in cash at the end of December, down from $47.4 million a year earlier, the company says it has since received $10 million from cornerstone investor China Oceanwide International Investment Co.
The Chinese shareholder has received FIRB approval to lift its interest in CuDeco to 19.9 per cent, which will bring another $20 million into the company's coffers.
CuDeco has reported a $13.7 million loss for the December half, up from a $2.4 million loss a year earlier.
The latest result has been impacted by an unrealised $7.1 million foreign exchange loss on the company's loan facilities due to the fall in the Aussie dollar and $2.9 million in impairments.
The forex loss compares with a $1.5 million gain a year earlier, but CuDeco chairman Wayne McCrae says the company does not plan to hedge its loans as future copper sales will be made in US dollars.
Meanwhile, the impairment has been recorded on CuDeco's logistics assets as the company has started using external logistics networks due to their availability following mine closures and scale-downs in the region. McCrae says this is more cost effective than using CuDeco's own purpose-built logistics facilities.
CuDeco's shares remain in a voluntary suspension pending the outcome of the capital raising with China Oceanwide which is acquiring 24 million shares in CuDeco at $1.25 each. The shares last traded at $1.40.
Author: Nick Nichols