Strandline Resources has taken another significant step towards becoming a minerals sands producer with strong support from the Tanzanian Government.
Stradline is signing a Lead Arranger mandate with Nedbank to act as a lead arranger and underwriter of a US$26 million finance facility for its Fungoni project in Tanzania.
The facility accounts for the majority of Fungoni’s total estimated development capital cost of US$32 million excluding taxes, levies and financing costs.
Key terms for the facility are described in Schedule 1, subject to Nedbank Credit Committee and other internal approvals.
Nedbank CIB has already commenced the detailed due-diligence process.
The facility remains conditional upon documentation and satisfactory completion of technical, financial, legal and environmental and social due diligence, which are targeted for completion by the end of the March quarter 2019 with Financial Close and first drawdown subject to customary conditions precedent.
With key mining and environment licences in place, 100% product pre-sold via offtake, strong Government support, EPC contract now executed and due-diligence underway with Nedbank CIB, Strandline is well positioned to commercialise its first project in Tanzania and capitalise on the growing mineral sands market.
The Fungoni DFS confirmed the project will deliver strong financial returns, including EBITDA of US$115 million, from production of premium-quality zircon and titanium products.
Fungoni will also pave the way for development and capital appreciation of Strandline’s other mineral sands projects in Tanzania and Australia, including the large scale Tajiri and Coburn projects respectively.
“The engagement of Nedbank CIB, a tier-one African mining finance institution, is a significant step and vote of confidence in Fungoni,” comments Strandline MD Luke Graham.
“This mandate with Nedbank CIB puts Strandline well on track to develop its first mineral sands project.
“We look forward to working with the Nedbank CIB team to complete the due diligence, credit process and legal documentation over the coming months and will continue to provide the community and our shareholders with updates throughout the process.
“The Lead Arranger mandate was prepared with the assistance of Azure Capital, Strandline’s financial adviser,” he continues.