16th Mar 2016 08:58
LONDON (Alliance News) - DekelOil Public Ltd on Wednesday said it has refinanced the development loan used to build the extraction mill at the Ayenouan project in the Ivory Coast.
DekelOil said the refinancing has significantly reduced interest costs, improving the profitability of the project.
The palm oil producer said the new seven-year EUR9.2 million loan with an interest rate of 7% has been secured from NSIA Banque Cote D'Ivoire, replacing the EUR8.7 million loan with an interest rate of 10.5% from BIDC-EBID, which had a remaining term of four years.
DekelOil said the reduction in interest will save the company around EUR270,000 per year, and said capital repayments in 2016 will be EUR600,000 lower than under the previous loan whilst repayments in 2017 will be EUR800,000 lower.
DekelOil is not stopping there, and said it is holding further discussions about improving the terms of the loan.
"Having produced 35,770 tonnes of crude palm oil in 2015, our first full year of production, DekelOil has rapidly become a major crude palm oil producer in Cote d'Ivoire. With the project significantly de-risked, we are now focused on ensuring the excellent progress made on the ground is fully reflected in our corporate structure and financing arrangements, the majority of which were secured to fund the construction of the mill," said Executive Director Lincoln Moore.
"2016 is shaping up to be another excellent year of progress for DekelOil. In addition to significantly lower interest costs following today's refinancing and also the cancellation of a EUR5.1 million capital note in December 2015, we expect a further increase in crude palm oil production and a ramp up in the production of palm kernel oil and palm kernel cake at our kernel crushing plant," he added.
DekelOil shares were up 5.5% to 1.24 pence per share on Wednesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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