PERTH (miningweekly.com) – Tanzania-focused graphite developer Kibaran Resources has signed a mandate letter with German bank KfW IPEX to explore financing options for the construction of the $77-million Epanko project.
“The mandate is a further step forward for Epanko and formally confirms KfW IPEX-Bank’s interest in participating in financing for the project after it received confirmation of the ‘in-principle eligibility for cover’ under the Untied Loan Guarantee (UFK) Scheme early in September,” said Kibaran MD Andrew Spinks.
He added that, while Kibaran did not wish to preempt the banks’ current due diligence on how and if the project could be financed through to mine construction, the company was heartened by the sentiments expressed by the bank leading up to the agreement.
Under the mandate letter, KfW IPEX-Bank would provide advice and structuring support in relation to UFK cover and, subject to a due diligence, would consider an initial senior loan of up to $40-million towards the Epanko construction.
“Our current discussions include KfW IPEX-Bank also assisting in arranging further debt financing arrangements to progress completion of the Epanko mine development,” Spinks added.
An updated production growth strategy has shown the project could deliver a combined 150 000 t/y of graphite concentrate by its sixth year of operations, a 50% increase over the initial estimates of 100 000 t/y.
Kibaran has secured all mining licences and environmental approvals for the Epanko project and it was anticipated that first production would start some 17 months after the completion of project financing.