Romarco Minerals announced in mid-June 2012 that, in light of recently revised permit scheduling, it had renegotiated a number of key contracts for equipment deliveries for development of its Haile gold mine in north-central South Carolina.
On May 23, Romarco reported it had received the following schedule from the U.S. Army Corp of Engineers for completing the Environmental Impact Statement (EIS) for the Federal 404 Wetlands permit for the project:
- Draft EIS filed - December 14, 2012,
- Draft EIS comment period begins - December 14, 2012,
- Draft EIS Public Hearing - January 29, 2013,
- Draft EIS comment period ends - February 28, 2013,
- Final EIS made available to public - July 19, 2013,
- Record of Decision on permit to be made - August 16, 2013.
Romarco’s Caterpillar mobile mine equipment for the Haile project is being held in inventory by the local dealer, Blanchard Machinery Co. Delivery of the equipment was previously targeted for March 31, 2013. Blanchard has agreed to deliver the equipment on a revised schedule aligned with the expected start of construction. For BMC to maintain the inventory over the extended schedule, Romarco will incur an additional $30,000/month, bringing the total monthly holding cost to approximately $230,000. This agreement maintains the previously agreed pricing, ensures timely delivery of new equipment with tires, and allows Romarco to defer the majority of the payment, approximately $29 million, until the earlier of Sept. 30, 2013 or when the equipment is delivered to Haile.
Romarco also has agreed with the local Hitachi shovel dealer, Flint Holdings, to align delivery of a shovel with the expected start of construction. Flint anticipates receiving the shovel in December 2012 and will maintain the shovel in its inventory until delivered to Haile. Beginning in December, Romarco will pay Flint a monthly holding cost of approximately $11,000 and make monthly down payment installments of approximately $43,000, deferring the majority of the payment until the shovel is delivered to Haile.
The manufacturer of the SAG and secondary ball grinding mills for the Haile project has also indicated it will re-align delivery and final payments by three to six months.
Romarco is continuing with detail design engineering for Haile, with a target to be 75% complete by the end of 2012.
Romarco President and CEO Diane R. Garrett said, “By realigning our equipment payments to coincide with the EIS schedule, we have maintained our financial flexibility while ensuring we will have our mobile mining fleet available when we are ready to start construction and mine development. We are extremely pleased with the support we have received from our equipment suppliers.”