Focus Ventures (FCV.V) has announced it has entered into an agreement with Sprott Lending whereby the latter will provide $5M in debt, maturing 18 months from now and carrying an interest rate of 12%. Focus Ventures can decide to repay this loan before the maturity date if it pays at least 6 months interest.
The company also sold a 2% NSR on its stake of the Bayovar 12 phosphate project to Radius Gold (RDU.V) which could be seen as a sister company (as both Radius and Focus are part of the Gold Group). Radius will pay $1M for the NSR and has granted Focus the right to repurchase 1% of it for $1M within 12 months.
Focus Ventures used the funds to accelerate the acquisition of 70% of the Bayovar 12 project. It will now acquire the stake for a $4M cash payment and spending $14M on the property and to complete a PFS by the end of this year (which would be quite fast, considering we are expecting a PEA by this summer). Meanwhile, Focus has received the necessary permits to start a Phase II drill program and we expect in excess of 100 million tonnes to be added to the current resource estimate.
Focus Ventures is by far one of the most exciting phosphate companies out there, and we were extremely impressed by the existing infrastructure surrounding the project. Click HERE to read our site visit report.
Disclosure: The author holds a long position in Focus Ventures. Please see our disclaimer for current positions.