PERTH (miningweekly.com) – Graphite miner Syrah Resource has finalised a non-binding term sheet and has been offered a conditional commitment of a $107-million loan from the US Department of Energy (DoE), to fund the initial expansion of its Vidalia active anode material (AAM) facility, in Louisiana.
The proposed loan will be made under the DoE’s Advanced Technology Vehicles Manufacturing (ATVM) loan programme, which supports the manufacture of eligible advanced technology vehicles, including electric vehicles, and qualifying components and materials in the US.
If finalised, the loan to Syrah subsidiary Syrah Technologies will be a first from the loan programme since 2011, and a first-ever from the loan programme to a materials processing facility.
“The finalisation of a term sheet and offer of a conditional commitment from DoE for a loan under the ATVM programme highlights Vidalia’s strategic position in the US and provides a strong validation of Syrah, Vidalia and the Vidalia initial expansion,” said Syrah MD and CEO Shaun Verner.
“Importantly, the loan will allow Syrah to accelerate its growth strategy in its downstream business and support the rapidly growing electric vehicle and battery supply chain in the US.”
Under the term sheet, the loan would be for a maximum of $107-million with a term of up to ten years from financial close. Interest on the loan will be fixed from the date of advance for the term of the loan at applicable long-dated US Treasury rates.
A binding loan agreement from the DoE is subject to the completion of a due diligence, the satisfaction of conditions precedent, approval of the Syrah board and all material governmental and third-party consent.
Syrah said on Tuesday that financial close for the loan waas targeted for the end of June, with first advance expected in the September quarter.
Syrah earlier this year announced a final investment decision on the $176-million expansion of its Vidalia AAM facility, which would see production increase to 11 250 t/y.