African Minerals secures financial deals to fund expansion plans

African Minerals on Tuesday said it secured two new financing deals with the Standard Bank of South Africa to fund expansion plans at its Tonkolili iron ore project in Sierra Leone.

African Minerals on Tuesday said it secured two new financing deals with the Standard Bank of South Africa to fund expansion plans at its Tonkolili iron ore project in Sierra Leone.

The Tonkolili project has a mine life of over 60 years and is expected to reach a run rate of 20m tonnes per annum (mtpa) in the second quarter this year. The firm is now working to ramp that up to 35mtpa.

Advertisement - Article continues below

The mining group established a $250m secured loan facility, structured to be able to be increased to fund the expansion.

African Minerals also secured a corporate revolving facility of $100m for general corporate purposes, replacing a $100m amortising standby facility of which $80m is currently outstanding, providing $20m of additional liquidity.

The company said the facilities would provide significant headroom and flexibility at corporate and operating levels.

Final credit committee approval was received for the establishment of the two credit facilities.

"I am delighted to report that the facilities that we outlined in December have now been approved, and am especially pleased that Standard Bank continues to be a cornerstone lender," said Chief Financial Officer, Miguel Perry.

"These facilities provide us with incremental financial flexibility through the project ramp up period, as well as a potential source of funding for the next phase of our expansion to 35 mtpa."

Shares increased 0.83% to 304.75p at 11:03 Tuesday.




Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

Industrial metals

Governments’ money-printing mania bodes well for base metals

Money is being printed like there is no tomorrow. Much of it will be used to pay for infrastructure projects – and that will be good for metals, says …
27 May 2020
Investment strategy

Are you a permabear? Three red flags to watch out for

Contrarian investors are often seen as bearish because the market tends to go up over time. But if that bearishness goes too deep, you risk seriously …
26 May 2020
EU Economy

Here’s why investors should care about the EU’s plan to tackle Covid-19

The EU's €750bn rescue package makes a break-up of the eurozone much less likely. John Stepek explains why the scheme is such a big deal, and what it …
28 May 2020