Peak Rare Earths Limited (ASX: PEK) has announced the signing of a non-binding indicative Lenders Consortium Term Sheet as part of its project financing process for the Ngualla Rare Earth Project.
The term sheet underpins a complete debt solution for the Ngualla Project with aggregate debt of US$176.6M.
Bardin Davis, Peak CEO said, “We are delighted by the strong support from some of Africa’s leading development finance institutions and export credit agencies. It is also particularly pleasing to have strong participation from major Tanzanian and East African focused banks. This marks an important validation of the Ngualla Project and another major milestone as we progress towards a Final Investment Decision.”
Following the signing of the term sheet, the lending consortium is set to commence its due diligence and formal credit approval processes in connection with the Ngualla Project. It has been signed by Industrial Development Corporation of South Africa Limited; Development Bank of Southern Africa Limited – potential participation will specifically be used to fund supporting infrastructure related to the project; CRDB Bank PLC – Tanzania; NMB Bank PLC – Tanzania; and an East African commercial bank.
Key aspects of the term sheet include:
• A two-tranche, senior secured project finance facility incorporating:
- a covered tranche supported by political and commercial risk insurance
- an uncovered tranche (consisting of both USD and Tanzanian Shillings)
• Total debt of US$176.6M
• Facility tenor of up to nine years including a grace period for construction and ramp up
• Provision for a cost overrun facility
• Market standard debt covenants
In addition, Export Credit Insurance Corporation of South Africa SOC Limited has confirmed indicative appetite to provide political and commercial risk insurance cover for a South African content-level linked senior debt tranche.
To find out more, please visit www.peakrareearths.com
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