Pensana Secures $268 Million Financing for Angola’s Longonjo Rare Earth Project
Pensana has secured approximately $268 million for its Longonjo rare earth project in Angola, including key funding from the Africa Finance Corporation and the Angolan Sovereign Wealth Fund. The project will significantly contribute to the global supply of rare earths and is expected to reduce CO₂ emissions while enhancing energy security.
Pensana, a developer of rare earths, has successfully secured approximately $268 million (£206.75 million) for the Longonjo rare earth project in Angola. This financing includes an $81.2 million contribution from the Africa Finance Corporation (AFC) as part of a larger $160 million syndicated loan facility, which is being coordinated with the South African bank Absa Bank. This loan is conditional upon the finalization of loan documentation and certain preconditions.
The funding will predominantly support phase one of the Longonjo project, which is managed by Pensana’s 84%-owned subsidiary, Ozango Minerais. This financing approach will address around 60% of the phase one costs. In addition, the AFC has authorized a $54.9 million investment via a convertible loan, contingent on the finalization of agreements and preconditions.
The Angolan Sovereign Wealth Fund (FSDEA) has previously provided a $15 million (Kz13.79 million) bridging loan and has approved an extra $38 million in equity and convertible loans for the project. Samaila Zubairu, the AFC president and CEO, expressed optimism regarding Africa’s potential in the global clean energy revolution, citing the region’s vast mineral reserves and the significance of responsible mining practices.
The Longonjo project, located in the Huambo district approximately 350 kilometers southeast of Luanda, is projected to produce around 20,000 tonnes per annum of mixed rare earth carbonate (MREC). Over the past six years, Pensana has invested upwards of $70 million in various exploration and environmental studies related to Longonjo, thereby establishing a compliant reserve of 30 million tonnes at a grade of 2.55% Total Rare Earth Oxides (TREO).
With the mine’s life projected to exceed 20 years, it aims to supply critical rare earth elements essential for producing permanent magnets utilized in electric vehicles and offshore wind turbines. Upon the initiation of phase two production, the Longonjo project is anticipated to contribute around 5% of the global supply of rare earth elements.
Moreover, independent assessments have revealed that Longonjo’s operations, benefiting from hydroelectric power and direct connectivity to the Atlantic Port of Lobito through the Lobito Corridor rail line, potentially could reduce CO₂ emissions by over 4 million tonnes. Notably, Pensana commenced the development of a $125 million rare earth processing hub at the Saltend Chemicals Park in Humber, UK, in 2021.
In summary, Pensana has secured substantial funding for its Longonjo rare earth project in Angola, with significant contributions from the Africa Finance Corporation and the Angolan Sovereign Wealth Fund. This project, projected to contribute significantly to the global supply of rare earths, demonstrates enhanced regional development potential and underscores the importance of Africa in the global clean energy sector. As the project progresses through various phases, it aims to drive responsible mining practices while advancing energy security.
Original Source: www.mining-technology.com
