Despite political unrest in Sierra Leone, international development banks have granted Nord Resources (NRD-N) a reprieve on debt forbearance for the Sierra Rutile operation.
The unrest forced the operation to shut down in early 1995, and the company had hoped to resume production by 1998. However, the recent ousting of the nation’s president, Ahmad Tejan Kabbah, by a military junta has pushed back plans to resume production.
Jailed agitator Johnny Paul Koromah has been freed and installed as the new president, while Kabbah has fled into exile.
International development banks have granted a 3-Month extension of an existing forbearance of debt agreement to the end of September. As a condition of the extension, Sierra Rutile will pay all the interest due during the extension period (about US$3 million), and half of one principal payment to each bank. The banks have agreed to refrain from taking action to collect on these loans.
Nord’s owns a 50% interest in Sierra Rutile, which mines and processes titanium dioxide minerals, including rutile and ilmenite. Situated 80 miles southeast of Freetown, the capital, Sierra Rutile is guarded by the company’s own private security force. It is the largest operation of its kind in the world and a major source of revenue and employment for Sierra Leone.
The remaining half is owned by Consolidated Rutile, most of which is held by Rennison Goldfields of Australia.
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