Walkabout Resources Ltd (ASX:WKT) has executed a non-binding, conditional term sheet for a US25 million debt facility in favour of Lindi Jumbo Ltd from the African Export-Import Bank (Afreximbank).
This represents another key step in financing for the development of the Lindi Jumbo Graphite Project in southeast Tanzania.
While the facility term sheet has several conditions precedent before it becomes binding, the company notes that this term sheet has already received initial bank approval.
“Outstanding economics”
Executive director Allan Mulligan said: “We have been working with the Afreximbank team on securing the funding for the Lindi Jumbo Project for some time and are very pleased that the application has now received initial approval.
“Each of the development banks we have been working with recognises the outstanding economics of the Lindi Jumbo Graphite Project and benefits it will bring to our local community.
“There is already some price tension emerging in the natural flake graphite market and we are working towards the world-class Lindi Jumbo mining reserve being able to deliver into that.”
The proceeds will fund the development of as well as the purchase of plant and equipment, mine development works and site infrastructure required for the project and for the completion of the plant commissioning process and the ongoing costs of production of graphite for export to its offtake partners.
Afreximbank background
Afreximbank is a pan-African multilateral trade finance institution created in 1993 under the auspices of the African Development Bank.
It is headquartered in Cairo, Egypt and Afreximbank's vision is to be the trade finance bank for Africa.
The debt facility is proposed to be secured by the Lindi Jumbo assets and supplemented by suitable credit insurance already identified by the company.
The loan has an 18-month grace period before repayments commence and a term of seven years to finalise.
Pareto Securities continues to apply its significant international in-house skillset in advising the company during this transaction.
