Australian iron ore miner Atlas Iron has announced that it has signed a debt structure agreement with the majority of its lenders, who have agreed to a plan to cancel $132 million of debt in exchange for shares and options in the company. On implementation of the financial restructuring contemplated by the agreement, Atlas will have reduced its term loan debt from $267 million to $135 million, with the maturity date extended from December 2017 to April 2021.
Meanwhile, the iron ore miner also announced that it has completed the pre-feasibility study into the development of a low-cost iron ore mine at its Corunna Downs project, located 40 km from the company’s Mt Webber project in the Pilbara region of Western Australia. As a result of the pre-feasibility study, the Corunna Downs Project has the potential to deliver four million mt per year of lump and fines direct shipping ore over an initial mine life of five to six years. Subject to iron ore market conditions, there are upside opportunities to extend the mine life by exploiting the below water table resources. It has the potential to replace Abydos and Wodgina mines which are currently expected to cease mining over the next two to three years.