cic-to-fund-expansion-of-southgobi-energy-resources

CIC to fund expansion of SouthGobi Energy Resources

The Canadian coal mining company will use the money to expand production and improve local transportation.

Toronto-listed SouthGobi Energy Resources yesterday announced that China Investment Corporation CIC has agreed to provide a $500 million loan to finance the expansion of the company's mining and exploration operations in the south of Mongolia. This is the first significant deal in Mongolia since its government signed the Oyu Tolgoi investment earlier this month.

The loan is in the form of convertible debentures issued by SouthGobi to CIC. The interest shall be 8% per annum, of which 6.4% shall be payable in cash and the remainder in SouthGobi shares. The maximum term of the loan is 30 years and $120 million of the total amount can be used for...

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