Oz-listed Melbana Borrows to Progress Projects
Australia-listed junior Melbana has taken a $2.5mn loan to help it progress its projects which include the Western Australian Beehive prospect that French Total and Australian Santos have agreed to farm into, the company said April 19. Beehive, in the Bonaparte Basin, is potentially the largest undrilled hydrocarbon prospect in the country.
“The loan facility will provide general working capital for the company and was assessed to be clearly the lowest cost option currently available to Melbana to provide it with additional working capital to progress its exciting portfolio of projects,” Melbana’s CEO Robert Zammit said.
The loan facility agreement is with Trans Asia Private Capital as manager for and on behalf of Asian Trade Finance Fund 2, a sub-fund of TA Asian Multi-Finance Fund.
The terms are an annualised interest rate of 15% with a maturity of January 10, 2019. And, Melbana’s chairman Andrew Purcell has given a personal guarantee in favour of the lender.
“Independent of the loan agreement and subject to shareholder approval being forthcoming at the next general meeting, the non-conflicted members of the board have decided to compensate Mr Purcell for providing this personal guarantee,” the company said.
The approval will seek to issue Purcell 80mn options to acquire Melbana shares at a strike price of 2.2 cents per share. Melbana’s share price was A$0.013 ($0.01) at April 20.
French Total and Australian Santos in December agreed to fully fund the cost of a 3-D seismic survey over the prospect in consideration for which, they are granted an option – exerciseable together or individually – to acquire a direct 80% participating interest in the permit. If the option is exercised, Total and/or Santos will fully fund the cost of all activities until completion of the first well.
Melbana’s portfolio also includes other exploration, appraisal and development stage opportunities in Australia, Cuba and New Zealand.
“Loan repayment options include recovery of back costs from a farmout transaction, divestment of non-core assets and the exercise of outstanding share options,” Zammit said.