PERTH (miningweekly.com) – The Northern Australia Infrastructure Facility (NAIF) could provide up to A$160-million to ASX-listed Verdant Minerals to develop its Ammaroo phosphate project, in the Northern Territory.

Verdant this week told shareholders that NAIF had provided the company with a non-binding indicative term sheet for a long-term debt funding facility, which was subject to a number of conditions.

These included the execution of offtake contracts with lender approved offtakers, finalising the terms for senior debt funding for the remainder of the project debt, securing the balance of equity funding from acceptable equity partners, and a detailed due diligence.

“This is a significant milestone for the project and will assist in facilitating and enhancing ongoing discussions with providers of commercial debt, potential customers and development partners,” said Verdant MD Chris Tziolis.

“Verdant Minerals is appreciative of the opportunity to work with the NAIF on the development of the Ammaroo phosphate project. The issuance of the indicative term sheet and NAIF support to provide a long tenure concessional loan, subject to meeting the conditions precedent, will secure a significant portion of the project’s debt funding.”

The Ammaroo project has been granted approval by the Northern Territory’s Environment Protection Authority and by the federal government under the Environmental Protection and Biodiveristy Conservation Act.

A feasibility study considered a Stage 1 development to produce one-million tonnes a year of phosphate rock concentrate, which will be replicated during year five, taking production to two-million tonnes a year of rock concentrate from year six until the end of the project’s 20-year mine life.

The Stage 1 development is expected to require a capital investment of A$368-million, while the Stage 2 development will require a further A$200-million investment.