VANCOUVER, BC – BioteQ Environmental Technologies Inc. (TSX:BQE), a leader in the treatment of metal and sulphate contaminated water, has agreed to provide $3 million in debt financing to Columbia Metals (TSX VENTURE:COL) to bring the Lluvia-Jojoba gold and copper mine into production, to coincide with the completion of BioteQ’s water treatment plant currently under construction. The debt facility provides for “loan” and “working capital” financing of up to $3 million from BioteQ. There is an extension option for a further $1 million loan facility which can be used to finance property payments by Columbia Metals.
The facility is split into two distinct components:
- $1.5 million in financing for property, engineering and permit payments to maintain the right to mine, advance and operate the project unencumbered which will be structured as a one year loan facility with a 12% interest rate (the “loan”), and
- $1.5M working capital loan for operating consumables and labour which will be invoiced monthly in arrears and is repayable within 6 months with an interest rate of 2% per month (the “working capital”).
If the loans are not repaid on the maturity dates, BioteQ is entitled to increase its share of all net revenues from the project, to 50% from 30%, until its loans are repaid. The loans are secured on the assets of the project.
BioteQ and Columbia have also arranged to amend their existing Construction and Operating Agreement. Under the terms of the amendment, BioteQ will control the gold recovery plant (ADR circuit) and charge Columbia for all operating and maintenance costs plus 15% mark-up, as well as operate its own SART plant for recovery of copper and cyanide. Columbia will maintain responsibility for mining, exploration and overall site management.
BioteQ is presently constructing a $5.2 million water treatment plant at the Lluvia site, to recover copper from cyanide solution and regenerate cyanide for re-use in the gold leaching process. Plant commissioning is scheduled to commence later in the second quarter of 2008.
Brad Marchant, BioteQ’s CEO, stated, “This short term investment confirms our confidence in the Lluvia-Jojoba project and ensures the project remains on schedule. The investment will have no impact on BioteQ’s ability to construct other plants currently in the pipeline and we believe it is a strategic use of BioteQ’s working capital at this time.”
Columbia Metals Corporate Profile
Columbia Metals Corp Ltd. (TSX VENTURE:COL) is a near term gold and copper producer with its principal production project, the Lluvia-Jojoba gold and copper mine project, located in the State of Sonora, Northern Mexico.
BioteQ Corporate Profile
BioteQ builds, owns and operates water treatment plants for the world’s mining companies and utility operators, reducing environmental liabilities while generating revenue from waste. The Company’s commercially proven technology treats acid mine drainage and other metal-laden waste water by sequentially removing metals and sulphate, producing saleable metal products and clean water that can be discharged safely to the environment. BioteQ is headquartered in Vancouver, Canada, and trades on the TSX under the symbol BQE. For additional information, go to www.bqewater.com.
On behalf of the Board of Directors
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or the accuracy of this release.