FMG might restart Kings project with debt refinancing facility

Fortescue Metals Group (FMG) could speed up its Kings project for launch in December 2012, after securing a $5 billion debt refinancing facility.

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Lead arrangers Credit Suisse and JP Morgan have completed the distribution process for the debt refinancing facility, which was upsized from $4.5 billion to $5 billion, FMG announced on Monday October 15.

“The facility provides funding flexibility to support the company through the commodity cycle and removes uncertainty around our financing arrangements,” the miner’s cfo Stephen Pearce said.

FMG’s ceo Neville Power noted a “potential for an early restart of the 40 million tpy Kings mine in December 2012” with the credit facility.

“Our commitment to ultimately expand to 155 million tpy and deliver the low-cost production from the Solomon mining hub remains unchanged,” Power said.

The plummeting iron ore market this year forced FMG to defer the development of the Kings deposit within its Solomon mining hub and to cut jobs.

The miner lowered its production target for the fiscal year 2013 to within 82-84 million tonnes, from the previous guidance of 86.5 million tonnes.