Northland Resources S.A.: Successful Second Cost-to-Complete Test Confirmed
LUXEMBOURG, LUXEMBOURG -- (Marketwire) -- 09/17/12 -- Northland Resources S.A. (TSX: NAU)(FRANKFURT: NPK)(OSLO: NAUR) ("Northland" or the "Company") announces that the independent engineer Royal HaskoningDHV ("Royal Haskoning") as well as the trustee have confirmed Northland's fulfilment of its second Cost-to-Complete test. Northland is now entitled to execute the second draw down of about USD 90 million from its USD 350 million bond loan facility.
In February 2012 Northland issued a corporate bond of 350 USD million. The funds are available on an escrow account with Norsk Tillitsmann ASA ("Norsk Tillitsmann") as the trustee. Northland Resources is entitled to draw down from the escrow account only after a Cost-to-Complete test performed by Royal HaskoningDHV (formerly known as Turgis Consulting Ltd) has been conducted. The purpose of the Cost-to-Complete tests is to ensure that Northland has sufficient funds available to complete the Kaunisvaara project.
"We are pleased with the results of Royal Haskoning's visit and analysis of the rapid development of our project," said Karl-Axel Waplan, President & CEO of Northland Resources. "Their report and the sign-off by Norsk Tillitsmann will allow us to do the second draw down. Following this drawdown Northland will have enough funding to start production."
Norsk Tillitsmann, in agreement with Northland, has appointed Royal Haskoning to act as independent engineer to monitor Northland until maturity of the bond in 2017. Since Royal Haskoning now has confirmed the satisfactory results of Northland's second Cost-to-Complete test, Northland is entitled to its second draw down of about USD 90 million. The first draw down of USD 150 million was announced on July 2, 2012.
The Northland bond has a 13% coupon rate which is payable in semi-annual installments. As per the bond agreement, the first installment on the bond was paid in September 6, 2012.
Karl-Axel Waplan, President & CEO, Northland Resources S.A.
Northland is a development-stage mining company with a portfolio of iron ore projects in northern Sweden and Finland. The Company's Kaunisvaara Project will initially exploit two magnetite iron ore deposits in Sweden. The process will yield a high-grade, high-quality magnetite iron concentrate. The construction of the Kaunisvaara project in Sweden is well underway and mining is expected to start in the fourth quarter of 2012. Northland has entered into off-take contracts for the entire production from Kaunisvaara over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study ("DFS") for its Hannukainen Iron Oxide Copper Gold ("IOCG") Project in Kolari, northern Finland and for its Pellivuoma deposit 15 km from the Kaunisvaara process plant.
Royal HaskoningDHV are headquartered in Amersfoort, Netherlands, and is one of Europe's leading project management, engineering and consultancy service providers, ranking globally in the top 10 of independently owned, non-listed companies and top 40 overall. With nearly 8,000 professionals providing services worldwide from 100 offices in 35 countries, Royal HaskoningDHV carries out more than 30,000 projects every year in planning, transport, infrastructure, water, maritime, aviation, industry, energy, mining and buildings.
Contacts:
Northland Resources S.A.
Karl-Axel Waplan
President and CEO
+46 705 104 239
Northland Resources S.A.
Peder Zetterberg
Acting CFO
+46 708 652 120
Northland Resources S.A.
Anders Antonsson
Vice President - Investor Relations
+46 709 994 970
Marguerite Manshreck-Head
Investors Relations, Canada
+1 647 224 7882
www.northland.eu