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Trevali Gets Buyer For Rosh Pinah Mine Stake

By: Staff Writer

Embattled base metals miner Trevali Mining Corporation will sell its 90% interest in the Rosh Pinah mine to Appian Natural Resources Fund III and Appian Natural Resources (UST) Fund III.

Trevali is a Canadian base-metals mining company with four producing operations in Canada, Peru, Burkina Faso and Namibia.

The Rosh Pinah mine is located in the //Kharas region, with 90% shareholding owned by Trevali and 10% owned by Namibian Broad-Based Empowerment Groups and an Employee Empowerment Participation Scheme.

The share and asset purchase agreement between Trevali Mining and Appian Natural Resources Fund III LP and Appian Natural Resources (UST) Fund III LP was clinched on December 15, 2022.

This forms part of a court-sanctioned sales process, initiated in September, for Trevali’s interest in Rosh Pinah mine, as well as its wholly-owned Caribou mine, in Canada.

Trevali in August suspended operations at Caribou and halted plans to expand Rosh Pinah mine after filing for protection from its creditors.

The company has suffered a number of setbacks this year, including flooding at its Perkoa mine, in Burkina Faso, which resulted in the deaths of eight people.

Trevali will seek court approval for the transaction with Appian after which further details of the transaction will be made public.

The closing of the transaction is subject to the satisfaction or waiver of certain conditions precedent, including receipt of an order approving the agreement and transaction from the court; the approval of the Namibia Competition Commission under the Competition Act (2003) of Namibia; approval of the Ministry of Land Reform; exchange control approval from the Bank of Namibia; and other customary closing conditions.

The transaction is expected to close in the first quarter of 2023.

Appian Natural Resources Fund III is a metal & mining fund managed by Appian Capital Advisory, while Appian Natural Resources (UST) Fund LP is a private equity fund also operated by Appian Capital Advisory located in London, United Kingdom.

In September this year, Trevali announced that the Supreme Court of British Columbia granted a sales and investment solicitation process order to the company, as well as its wholly owned subsidiary Trevali Mining (New Brunswick) Ltd. and Trevali Corp.

The earlier month, the company announced the suspension of its Rosh Pinah 2.0 mine expansion project, announced in 2020 to increase production from the current 700 000 tonnes to 1,3 million tonnes annually at a total capital expenditure of US$93 million.

The expenditure of US$93 million was to modify the current processing plant, construction of a paste fill plant, and development of a dedicated portal and ramp to the future deposits, for which the company had secured credit approval for a U$110 million senior debt facility from Standard Bank of Namibia Limited and Standard Bank of South Africa Limited.

Director of investor relations at Trevali Jason Mercier said at the time that the closing of the senior secured financing facility is subject to a number of conditions, including the negotiation and settlement of definitive agreements and other necessary documentation for both the facility with Standard Bank, as well as other elements of the financing package and the consent of Trevali’s existing senior secured lenders.

“While the company is progressing these various work streams and Standard Bank remains supportive of the Rosh Pinah 2.0 project, there is no certainty as to timing or that the conditions set out in the Standard Bank credit approval will be satisfied.

“Against this backdrop, the early works programme at Rosh Pinah was put under review and the expansion project suspended while the company pursues a comprehensive financing initiative,” said Mercier.

“With the SISP order obtained and the sales process underway for the company’s interests in the Rosh Pinah and Caribou mines, the board and Grimbeek determined that it was the appropriate time for him to step away from Trevali,” says the press release.

In addition, Derek du Preez resigned as chief operating officer of the company, effective 14 October 2022, to support a transition of operational, technical, and other aspects of the business, as well as the initial phase of the sales and investment solicitation process.

The court order sets out a timeline for the process, saying a final agreement should be reached by 14 November this year. The sale would need to be approved by the court.

The Rosh Pinah mine has been in continuous operation since 1969, and currently produces zinc and lead sulphide concentrates containing minor amounts of copper, silver, and gold. The zinc and lead concentrates are transported by road to Lüderitz, and then shipped to international markets.

Staff Writer

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