Alderon Iron Ore Corp. (TSX:ADV) (NYSE MKT:AXX) ("Alderon" or the
"Company") is pleased to announce that it has signed an engagement
letter (the "BNP Paribas Engagement Letter") under which it has
given BNP Paribas an exclusive mandate to act as lead arranger of
up to a US$1 billion senior debt financing facility (the "Senior
Debt Facility") to complete the construction and start-up of the
Kami Iron Ore Project (the "Kami Project"), located in the Labrador
Trough. The BNP Paribas Engagement Letter sets forth the required
steps, including agreement on final terms and conditions and
requisite documentation for the Senior Debt Facility, completion of
due diligence, and procurement of credit approvals, among other
things. The BNP Paribas Engagement letter does not constitute a
commitment to provide financing.
Alderon is pursuing a financing strategy for the Kami Project
based on a combination of the Senior Debt Facility, other debt
options, equipment financing, equity and off-take partner
contributions. In order to provide flexibility and maximize its
financing options, Alderon intends to pursue the Senior Debt
Facility and its other debt options in parallel, and is targeting a
total debt financing amount of US$1 billion. Alderon will in
particular be evaluating an offering of senior secured notes in the
capital markets to ensure that it obtains the total US$1 billion
target.
"The signing of the engagement letter represents a significant
step forward towards obtaining project financing for the
construction of the Kami Project," said Mark Morabito, Alderon's
Executive Chairman. "We expect our financing strategy to provide
maximum flexibility for Alderon to achieve its US$1 billion debt
financing target and to obtain all of the required capital to
develop the Kami Project. Alderon also expects that a portion of
the debt financing will be provided by Chinese banks given Hebei
Iron & Steel Group's involvement in the Kami Project and the
strong relationship that Hebei has with many Chinese banks."
"We are pleased to be working with the BNP Paribas team to bring
the Kami Project into production. The combination of the proven
financial capability of BNP Paribas, coupled with the high quality
project team currently at work on the Kami Project gives us great
confidence that this project will be developed in an
environmentally and socially responsible manner to the benefit of
our shareholders, employees and local stakeholders" said Tayfun
Eldem, President and CEO of Alderon. "We believe the high quality,
large scale and favorable proximity to infrastructure in the
Labrador Trough combined with 60% of the production presold to
Hebei for the next 15 years, make it an attractive candidate for
financing from the international banking community. This step
illustrates that progress for finalizing our financing is keeping
pace with the Kami Project environmental assessment process, which
we expect to be nearing completion in the coming months."
This press release shall not constitute an offer to sell or a
solicitation of an offer to purchase any securities of the Company
in the United States or any other jurisdiction. The securities of
the Company have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the "U.S. Securities Act"), or
the securities laws of any other jurisdiction and may only be
offered and sold in the United States pursuant to an exemption from
the registration requirements of the U.S. Securities Act. In
addition, the securities of the Company may only be offered and
sold in Canada pursuant to an exemption from the prospectus
requirements of Canadian securities laws.
About Alderon
Alderon is a leading iron ore development company in Canada with
offices in Vancouver, Toronto, Montreal, St. John's and Labrador
City. The Kami Project, owned 75% by Alderon and 25% by Hebei Iron
& Steel Group Co., Ltd. ("HBIS"), is located within Canada's
premier iron ore district and is surrounded by four producing iron
ore mines. The Alderon team is comprised of skilled professionals
with significant iron ore expertise to advance Kami towards
production. HBIS is Alderon's strategic partner in the development
of the Kami Project and China's largest steel producer.
For more information on Alderon, please visit our website at
www.alderonironore.com.
ALDERON IRON ORE CORP.
On behalf of the Board
Mark J Morabito, Executive Chairman
Cautionary Note Regarding Forward-Looking Information
This press release contains "forward-looking information" within
the meaning of the U.S. Private Securities Litigation Reform Act
and Canadian securities laws concerning anticipated developments
and events that may occur in the future. Forward-looking
information contained in this press release include, but are not
limited to, statements with respect to (i) the development of the
Kami Project; (ii) the anticipated amount, timing and successful
completion of the Senior Debt Facility and other financing; (iii)
the completion of the environmental assessment process; (iv) the
commencement of construction and commercial production of the Kami
Project; and (v) the anticipated involvement of Chinese banks in
the debt financing process.
In certain cases, forward-looking information can be identified
by the use of words such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate", or
"believes", or variations of such words and phrases or state that
certain actions, events or results "may", "could", "would", "might"
or "will be taken", "occur" or "be achieved" suggesting future
outcomes, or other expectations, beliefs, plans, objectives,
assumptions, intentions or statements about future events or
performance. Forward-looking information contained in this press
release is based on certain factors and assumptions regarding,
among other things, receipt of governmental and other approvals,
the estimation of mineral reserves and resources, the realization
of resource estimates, iron ore and other metal prices, the timing
and amount of future exploration and development expenditures, the
estimation of initial and sustaining capital requirements, the
estimation of labour and operating costs, the availability of
necessary financing and materials to continue to explore and
develop the Kami Property in the short and long-term, the progress
of exploration and development activities, the receipt of necessary
regulatory approvals, the completion of the environmental
assessment process, the estimation of insurance coverage, and
assumptions with respect to currency fluctuations, environmental
risks, title disputes or claims, and other similar matters. While
the Company considers these assumptions to be reasonable based on
information currently available to it, they may prove to be
incorrect. The BNP Paribas Engagement Letter does not constitute a
commitment to underwrite, provide or secure financing, which
remains subject to due diligence, the preparation of offering
documents and completion of other definitive documentation, credit
and other approvals, and market and other conditions. There can be
no assurance that the anticipated Senior Debt Facility or other
financing will be completed on terms acceptable to Alderon or at
all.
Forward looking information involves known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking information. Such
factors include risks inherent in the exploration and development
of mineral deposits, including risks relating to changes in project
parameters as plans continue to be redefined including the
possibility that mining operations may not commence at the Kami
Property, risks relating to variations in mineral resources, grade
or recovery rates resulting from current exploration and
development activities, risks relating to the ability to access
rail transportation, sources of power and port facilities, risks
relating to changes in iron ore prices and the worldwide demand for
and supply of iron ore and related products, risks related to
increased competition in the market for iron ore and related
products and in the mining industry generally, risks related to
current global financial conditions, uncertainties inherent in the
estimation of mineral resources, access and supply risks, reliance
on key personnel, operational risks inherent in the conduct of
mining activities, including the risk of accidents, labour
disputes, increases in capital and operating costs and the risk of
delays or increased costs that might be encountered during the
development process, regulatory risks, including risks relating to
the acquisition of the necessary licences and permits, financing,
capitalization and liquidity risks, including the risk that the
financing necessary to fund the exploration and development
activities at the Kami Property, including the proposed Senior Debt
Facility, may not be available on satisfactory terms, or at all,
risks related to disputes concerning property titles and interest,
risks related to disputes with Aboriginal groups, environmental
risks, and the additional risks identified in the "Risk Factors"
section of the Company's Annual Information Form for the most
recently completed financial year, which is included in its Annual
Report on Form 40-F filed with the U.S. Securities and Exchange
Commission (the "SEC") or other reports and filings with applicable
Canadian securities regulators and the SEC. Accordingly, readers
should not place undue reliance on forward-looking information. The
forward-looking information is made as of the date of this press
release. Except as required by applicable securities laws, the
Company does not undertake any obligation to publicly update or
revise any forward-looking information.
Contacts: Alderon Iron Ore Corp. Montreal Office 514-281-9434
514-281-5048 (FAX) Alderon Iron Ore Corp. Vancouver Office
604-681-8030 604-681-8039 (FAX) Alderon Iron Ore Corp. Ian Chadsey
Investor Relations 1-514-817-5799 or
1-888-990-7989info@alderonironore.com www.alderonironore.com
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