Tanzania – Magnis Resources has signed an MoU with South Korean industry leader POSCO E&C outlining the basis for co-operation on the procurement of funding and construction of the Nachu Graphite project in Tanzania.
Key roles and responsibilities outlined in the MoU are as follows:
- POSCO E&C is mandated for arranging senior loans through its associations with financial institutions.
- Magnis is responsible for arranging subordinate debt and equity and the overall co-ordination of Project funding.
- Magnis to update resource/reserve definition and a feasibility study to the satisfaction of lenders.
- POSCO E&C to develop a fixed price lump sum for Project execution by second quarter 2016.
- Magnis, with support from POSCO E&C, will advance the construction contract in parallel to the funding process.
“This marks another milestone for Magnis. Having POSCO E&C onboard as our lead arranger and EPC consultant really highlights the quality of our project. POSCO E&C has demonstrated time and again that they can bring projects into production on-time with the highest standards,” says Magnis Resources chairman Frank Poullas.
He added that Magnis has been impressed with its dealings with POSCO E&C over the past three months and welcomes the partnership and the confidence that POSCO E&C shares in the Nachu Graphite project.”
Poullas says that the financial and sovereign stability afforded by the recent finalisation of the mineral development agreement along with the recent capital raising has been the catalyst to the funding process. The team at Magnis is now focused on ensuring commencement of production by the first quarter of 2017.
POSCO E&C Mining Plant Business group rirector Peter Lim commented: “We are delighted to be involved with the Nachu Graphite project. The quality of the graphite at Nachu is the best in the world and with the huge demand in the battery market, we are excited to be involved with Magnis.”
In addition to the raising of senior debt, Magnis has entered into discussions with a number of parties interested in providing subordinate debt. To date these discussions are progressing well and the MoU with POSCO E&C will add further weight to the credibility and strength of the Nachu Graphite Project.
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