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Aquila Resources Says Debt Funding Talks Nearing Completion

Nov. 8 (Bloomberg) -- Aquila Resources Ltd., developing a A$5.2 billion ($5.4 billion) iron ore mine in Australia, said talks for debt funding with China Development Bank Corp. are nearing completion, sending its shares to a three-month high.

The company expects to execute a term sheet before the end of the year, Perth-based Aquila said today in a presentation. Aquila said in its annual report last week it was in “well advanced” talks for a debt facility of more than $2 billion to help fund its share of the West Pilbara Iron Ore Project.

Aquila, with third-largest shareholder Baosteel Group Corp., plans to develop the port, rail and mine project with AMCI Inc. as demand for steel in China grows. The project is set to start shipping in 2016, initially exporting 30 million metric tons a year.

Aquila climbed 6.9 percent to A$6.65 at the close of Sydney trading, the highest since Aug. 2. The benchmark S&P/ASX 200 Index gained 0.5 percent.

The company is also planning to sell the Washpool coking coal project in Australia and the Avontuur manganese project in South Africa to help fund its share. Washpool, which may be worth A$366 million according to a June estimate from Patersons Securities Ltd., should be sold by the end of the year, Aquila said today.

To contact the reporter on this story: Elisabeth Behrmann in Sydney at ebehrmann1@bloomberg.net

To contact the editor responsible for this story: Rebecca Keenan at rkeenan5@bloomberg.net

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