PERTH (miningweekly.com) – Mineral sands developer Strandline Resources has signed a $26-million project finance facility agreement with financier Nedbank CIB for its Fungoni project, in Tanzania.
The facility will account for the majority of Fungoni’s $35-million capital cost, Strandline said on Monday.
“Once concluded, this facility will account for a large portion of Fungoni’s funding requirements and discussions about sourcing the remainder of the capital are progressing,” said Strandline MD Luke Graham.
“Nedbank is a highly experienced lender to African mining projects and it has conducted extensive due diligence on Fungoni, so to sign this facility agreement with them is a strong endorsement of the project.”
Graham noted that as part of the equity raising process, Strandline is in discussions with international finance institutions about strategic equity investments at either company or project levels.
An updated definitive feasibility study (DFS) into the Fungoni project estimated a pre-tax net present value of $48.7-million and an internal rate of return of 61%, with the two-million-tonne-a-year project expected to produce 302 300 t of saleable mineral sands product over the six-year mine life.
With key mining and environmental licences in place, the DFS completed, offtake contracts secured for all of the forecast product revenue, major construction contracts executed and the debt facility now signed, Strandline is on track to develop Fungoni, which will also pave the way for the development and value appreciation of its other mineral sands projects in Tanzania, including the large-scale Tajiri project.