According to the special site Online miningCanadian company Sherrid International has agreed to liquidate with the Cuban government (in five years and until January 1, 2023). Total debt of 362 million Canadian dollars (260 million US dollars).)
The agreement, known as a “cobalt swap,” will allow each shareholder in the Moa joint venture in Cuba to prioritize dividend payments in the form of finished cobalt. Each partner’s share of these cobalt dividends is then returned to Sherritt to repay the loan.
In a press release reviewing the aforementioned portal, Sherrid’s Chairman and CEO Leon Pinetel said:
“We were able to negotiate agreements that established an effective schedule Full repayment of outstanding loans by our Cuban partners Within five years, we believe this will put an end to the historical uncertainty of repayment.
Along with Sherritt’s stock dividend, “it is expected to provide significant cash flow to meet our strategic priorities to reduce debt and aggressively expand our business,” he added.
As the text explains, the terms of the cobalt swap assume that General Nickel Company (GNC), Sherritt’s partner in the Moa joint venture, will “repay in full certain outstanding obligations owed to Sherritt by Union Cubapetroleo (CUPET) and Energas SA in an amount over a five-year period.”
It was also announced that “in addition to the cobalt transfer, an extension of the payment agreement with Cuban partner Energas has been executed to fund Energas’ operation and maintenance costs.” It also includes security for future payments due to Sherritt.
In this sense, Sherrid expects to continue earning about $4.2 million ($5.6 million Canadian) per monthThrough a payment agreement with Moa and Energas joint venture.
Moa will convert foreign currency into Cuban pesos through Energas to support the company’s local operations in Cuba.
From Sherritt they assume “cobalt swap” provides a mutually beneficial agreement to pay outstanding bills within a reasonable time without depending on Cuba’s ability to access foreign currency.