PolyMet gets $30 million loan from Glencore
PolyMet Mining Corp. announced Monday that it has landed $30 million from its minority owner, Swiss-based Glencore, to cover expenses for this year. The loan from the global commodities giant will come in four quarterly installments with $8 milli...
PolyMet Mining Corp. announced Monday that it has landed $30 million from its minority owner, Swiss-based Glencore, to cover expenses for this year.
The loan from the global commodities giant will come in four quarterly installments with $8 million already delivered in January, another $8 million in April and July, and $6 million in October.
PolyMet will pay 8 percent interest on the loan which the fledgling Toronto-based mining company needs to keep moving forward on its proposed copper-nickel-precious metals mine outside Hoyt lakes.
Polymet is proposing Minnesota's first-ever copper mine, an open pit project that is awaiting state and federal environmental approval. Regulators are expected to announce this spring whether the environmental review so far is enough to allow the project to move ahead.
The proposed Minnesota mine is PolyMet’s only project and, without any income, PolyMet has been burning through cash for more than a decade as it develops a mine plan, prospects for the best deposits and conducts an environmental review for the so-called NorthMet project.
“This loan facility covers our anticipated costs through 2015 as we work through completion of the final Environmental Impact Statement and subsequent issuance of permits needed to construct and operate NorthMet,” said Jon Cherry, PolyMet president and CEO, in a statement.
Cherry said the company continues to focus on securing permits to mine, obtaining financing to build the operation and starting construction. PolyMet has to pay the $30 million back by March 2016 or when the company obtains at least $100 million for construction, whichever comes first.
“The environmental review and permitting process continues to track in line with the schedule outlined by the commissioners of the (Minnesota) Department of Natural Resources and the Pollution Control Agency last fall," Cherry said.
State officials say they will have a decision on mining permits within 150 days of the environmental review approval.
Glencore, which has mines across the world, already owns about 28 percent of PolyMet stock. It is ranked No. 10 on the Fortune Global 500 list of the world's largest companies.
PolyMet plans a $600 million open pit mine and processing center employing 300 people for 20 years or more, mining and processing copper, nickel, platinum, palladium and possibly other valuable metals.
Supporters say the project can be done without long-term harm to the environment, providing an economic boost to the regional economy.
Critics say the long-term potential for acidic runoff from copper-bearing rock and other potential water pollution problems aren't worth the relatively short-term jobs created. They say the boom-and-bust cyclical nature of the mining industry is not sustainable for the region.
The DNR received more than 58,000 public comments on the mine proposal, by far the most ever for any project in state history. The DNR, U.S. Forest Service and U.S. Army Corps of Engineers currently are sorting and developing answers to those comments.