Pensana plc (LON:PRE) has provide the following update on debt finance for the Longonjo project:
- The Company, through its 84% owned subsidiary Ozango Minerais SA (Ozango), which owns 100% of the Longonjo project, has concluded a non-binding term sheet (Term Sheet) with the Longonjo lender consortium for a project finance debt facility (Facility).
- The Facility amount is up to US$156 million with a participation of up to 50% between each of the lender participants.
- The purpose of the Facility is to provide limited recourse senior secured project finance to fund the Longonjo mine, flotation circuit and refinery.
- The maximum tenor of the Facility is to cover the construction period and ramp up to full production plus four years to an overall maximum of seven years.
- The Facility is conditional on obtaining guarantees from the relevant export credit agency for which discussions are well advanced.
- The Company is furthermore in advanced discussions with the Angola Sovereign Wealth Fund (FSDEA) and a member of the lender consortium to finalise the US$80 million equity component of the overall financing package.
- Conclusion of the Term Sheet follows the successful completion of a modular redesign of the fully permitted Longonjo mine and processing facility, with a total capital expenditure (including 10% contingency) of US$217 million, making it one of the lowest amongst its peers.
- The Company is in advanced discussions with several parties for the offtake of the highly marketable, radionuclide-free mixed rare earth carbonate (MREC) and has recently received product approval from one of its potential customers.
- The Company expects to be in a position to sign up to 100% of the production of the high value, clean MREC from the Longonjo processing facility.
