Pensana has secured $268 million in funding for its Longonjo rare earth project in Angola. The financing includes a $160 million syndicated loan from the AFC and Absa Bank. The project is poised to produce high-value rare earth carbonate and aims to support the global clean energy transition, contributing significantly to regional development and energy security.
Pensana, a rare earths development company, has successfully secured approximately $268 million (£206.75 million) to advance the Longonjo rare earth project in Angola. The Africa Finance Corporation (AFC) has approved an $81.2 million contribution as part of a $160 million syndicated loan facility, partnered with Absa Bank, contingent upon completing loan documentation and meeting specific conditions. This funding will cover roughly 60% of phase one financing for the Longonjo project, managed by Pensana’s 84%-owned subsidiary, Ozango Minerais.
Additionally, the AFC has authorized a $54.9 million investment through a convertible loan, which also necessitates finalization of definitive agreements. The Angolan Sovereign Wealth Fund (FSDEA) has provided a $15 million bridging loan and has sanctioned an extra $38 million in equity and convertible loans for the initiative.
AFC President and CEO Samaila Zubairu emphasized Africa’s potential in the rare earth sector, stating that the continent holds approximately one-third of the world’s rare earth mineral reserves. He remarked on the partnership with Pensana and FSDEA, declaring their commitment to unlocking Africa’s mineral capabilities and promoting regional development while enhancing global energy security.
The Longonjo project, located in the Huambo district approximately 350 km southeast of Luanda, is projected to produce around 20,000 tonnes per annum (tpa) of high-value mixed rare earth carbonate (MREC). Pensana has invested over $70 million in exploration and environmental studies over the past six years and identified a near-surface JORC-compliant reserve of 30 million tonnes with a grade of 2.55% TREO.
With an anticipated mine life exceeding 20 years, the Longonjo project is crucial for supplying rare earth elements vital for permanent magnets utilized in electric vehicles and offshore wind turbines. Following the commencement of phase two production, the mine is estimated to account for approximately 5% of the global production of rare earth elements. Furthermore, the project is expected to reduce CO₂ emissions by more than 4 million tonnes, aided by hydroelectric power and accessibility to the Atlantic Port of Lobito via the Lobito Corridor rail line.
In 2021, Pensana initiated early development of a $125 million rare earth processing hub at the Saltend Chemicals Park in Humber, UK.
In conclusion, Pensana’s successful financing of $268 million for the Longonjo project marks a significant milestone in the rare earths sector, promoting sustainable and responsible mining in Africa. With substantial backing from the AFC and the FSDEA, the project aims to enhance global energy security while making meaningful contributions to regional development. The Longonjo project is poised to play a pivotal role in supplying essential rare earth elements for clean energy technologies.
Original Source: www.mining-technology.com
