Lenders have allowed amendments to Term Loan B, allowing Atlas to accumulate up to $45 million.

The loan is currently subject to a cash sweep provision, with cash in excess of $80 million to be applied to debt.

Under the amendments, the company will transfer up to $45 million into a reserve account to fund Corunna Downs, with cash not drawn from the account before the end of June 2018 to be used to repay lenders.

Atlas owed around $118 million on the two term loans as of the end of December.

Atlas managing director Cliff Lawrenson said the amendments were a strong vote of confidence in the company.

“Corunna Downs, together with Mt Webber, will rebuild our production rate to approximately 12 million tonnes per annum after Wodgina and Abydos cease production in the first and second half of 2017 respectively,” he said.

“The amendments to the facility will enable Atlas to capitalise on current and future opportunities provided by the stronger iron ore price.”

Atlas released the feasibility study for the 4 million tonne per annum direct shipping ore Corunna Downs project in December, outlining a five to six-year mine life.

C1 costs are expected to be $A37-43 per wet metric tonne, with full cash costs of $49-55/wmt.

Atlas is reviewing opportunities to reduce C1 costs to the lower end of the range.

The life of mine breakeven price is estimated at around $US50 per dry metric tonne.

The mine, near Marble Bar, would produce 50:50 lump and fines, based on a 21Mt ore reserve at 57% iron.

Atlas sees the potential to extend the mine life, with current reserves coming from above the water table only.

First ore on ship from Corunna Downs is targeted for the March 2018 quarter.

Atlas shares closed at 4.8c yesterday, up from 1.3c at the end of October.