26th Feb 2024 10:58
(Alliance News) - Shares in Pensana PLC rose on Monday, after securing a new debt finance facility for its flagship Longonjo project.
Pensana is a magnet metal exploration company, whose subsidiary Ozango Minerais SA owns 100% of the Longonjo rare earth project in western Angola.
Shares in the company were up 13% at 34.60 pence each in London on Monday morning.
This came after Pensana said it had concluded a non-binding term sheet with the Longonjo project's lender consortium for a finance debt facility of up to USD156 million.
Conclusion of the term sheet comes after the company completed a modular redesign of the Longonjo mine and processing facility, with total capital expenditure of USD217 million.
Pensana said that the upfront USD217 million cost for the fully permitted mine and processing facilities is "amongst the lowest amongst its peers".
Pensana added that it was in negotiations with the Angola Sovereign Wealth Fund, as well as a member of the lender consortium, to finalise the USD80 million equity component of the overall financing package. The Angola Sovereign Wealth Fund has so far provided a USD15 million bridging loan towards this equity investment.
The company is also in "advanced discussions" with several parties for the offtake of radionuclide-free mixed rare earth carbonate produced at Longonjo. Pensana expects to be able to sign up to 100% of the clean MREC from the processing facility. From 2026, Longonjo will produce 20,000 tonnes of MREC, Pensana said, rising to 40,000 tonnes from 2029 onwards.
Chair Paul Atherley said: "This is a major step for the company in its plans to bring into production one of the world’s largest undeveloped rare earth projects.
"It is also an important step for the establishment of an African-based, independent, supply chain of the metals crucial to the energy transition, which captures significant value within Angola and creates several hundred long-term high value jobs within the local community."
By Hugh Cameron, Alliance News reporter
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