Lotus Signs US$38.5m Financing to Support Kayelekera Production by Q3 2025
Lotus Resources has locked in US$38.5 million in financing to support the restart and ramp-up of its Kayelekera uranium project in Malawi, targeting positive cash flow by Q3 2025.
- US$18.5 million equipment finance term sheets signed with Standard Bank Plc and First Capital Bank
- US$20 million working capital facility secured with Standard Bank Plc
- Total funding package now US$135.5 million including cash and loans
- Kayelekera uranium production restart on track for Q3 CY2025
- Conditional uranium offtake agreements in place for 1.5 million lbs from 2026 to 2029
Financing Milestone for Kayelekera Restart
Lotus Resources Limited (ASX: LOT) has taken a significant step forward in its plan to restart uranium production at the Kayelekera mine in Malawi by signing term sheets for up to US$38.5 million in financing. The funding package includes US$18.5 million in equipment finance from two leading Southern African banks, Standard Bank Plc and First Capital Bank Limited, and a US$20 million working capital facility with Standard Bank Plc. These facilities are designed to support the purchase or refinancing of critical equipment and to provide liquidity until the project reaches positive cash flow.
Robust Funding Position
This latest financing complements Lotus’s existing cash reserves and loan facilities, bringing total current funding to US$135.5 million. This includes US$82 million in cash as of December 31, 2024, and a US$15 million unsecured loan from Curzon Uranium. The company’s strong capital position underpins confidence in the accelerated restart program, which is progressing rapidly with over 200 personnel on site, key equipment ordered, and construction underway.
Strategic Offtake Agreements
Lotus has secured conditional uranium offtake agreements totaling 1.5 million pounds for delivery between 2026 and 2029 with Tier 1 counterparties Curzon Uranium and PSEG Nuclear LLC. These contracts are priced at escalated fixed rates, providing a degree of revenue certainty as production ramps up. The company is also actively engaging with additional North American power utilities to expand its offtake portfolio, which could further strengthen its market position.
On Track for Production Restart
Managing Director and CEO Greg Bittar highlighted the competitive terms secured for the financing facilities, attributing this to the quality of the Kayelekera project and the progress made to date. The equipment finance term sheets feature a five-year tenor with repayments commencing after a six-month moratorium, while the working capital facility offers up to a two-year tenor with monthly repayments. Both facilities remain subject to credit approval and customary conditions.
The Kayelekera mine, which previously produced approximately 11 million pounds of uranium between 2009 and 2014, is poised for a restart in Q3 CY2025. The project benefits from a substantial mineral resource base and a positive restart study confirming its viability. With all major equipment ordered and mobilised, the company is well positioned to meet its production targets.
Looking Ahead
As Lotus Resources advances toward production, the successful deployment of this financing will be critical to maintaining momentum. The company’s ability to convert its mineral resources into steady cash flow will be closely watched by investors, especially given the strategic importance of uranium in the global energy transition.
Bottom Line?
Lotus’s financing deal sets the stage for a pivotal uranium production restart, but execution risks remain as credit approvals and ramp-up unfold.
Questions in the middle?
- Will the financing facilities receive final credit approval without delays or changes?
- How quickly can Lotus convert uranium production into sustained positive cash flow?
- What impact will additional offtake agreements with North American utilities have on project economics?
