Absa Bank has conditionally approved a term sheet for a 50% participation in a $160 million syndicated loan facility to finance Pensana’s Longonjo rare earths project in Angola. This loan, provided through Absa’s Corporate and Investment Banking division, will support the Phase 1 development of the mine through Pensana’s 84%-owned subsidiary, Ozango Minerais.
The loan approval is contingent upon final loan documentation, fulfillment of specific conditions, and securing political and commercial risk insurance for Absa’s exposure. The debt financing will cover approximately 60% of the project costs, with the remaining 40% provided as equity by Ozango.
Pensana Chairperson Paul Atherley highlighted the significance of this funding milestone. He emphasized the project’s potential to create over 600 high-value jobs, with a focus on young people, and generate approximately 2,400 direct and indirect jobs at full production. Longonjo is projected to produce around 5% of the world’s magnet metal rare earths, crucial for wind turbines and electric vehicles.
The term sheet approval follows extensive due diligence, including technical, marketing, environmental, and fiscal assessments. Absa’s credit committee has conditionally approved the loan, with legal due diligence nearing completion.
Pensana has invested over $70 million in exploration, technical studies, and environmental assessments for Longonjo over the past six years. The total cost to bring the project into full production is estimated at $325 million, with operating expenditures over the 20-year mine life projected at $2.3 billion.