Black Rock Mining has secured an additional US$25 million in funding, increasing its total project financing to US$204 million to advance the Mahenge Graphite Project in Tanzania.
- US$25 million increase in Facilities Agreement to US$204 million
- Additional funds provided by CRDB Bank via Construction Term Loan
- Loan tenor extended by approximately 12 months
- First repayment deferred by 9 months to 4.25 years post-FID
- Funding supports construction of Mahenge Module 1 and infrastructure
Funding Boost for Mahenge Graphite Project
Black Rock Mining Limited (ASX: BKT) has announced a significant increase in its project financing, securing credit approval to raise its Facilities Agreement by US$25 million. This brings the total available funding to US$204 million, a crucial step forward for the development of the Mahenge Graphite Project in Tanzania. The additional funds will be provided by CRDB Bank, a leading Tanzanian lender, through an increase in the Construction Term Loan from US$113 million to US$138 million.
Extended Loan Terms and Deferred Repayments
Alongside the increased loan amount, the tenor of the Facilities Agreement has been extended by approximately 12 months, from around 7.5 years to 8.5 years. The first scheduled repayment has also been pushed back by nine months, now expected to commence 4.25 years after the Final Investment Decision (FID). These adjustments provide Black Rock with greater financial flexibility as it moves towards construction and operational readiness.
Comprehensive Financing Package
The updated Facilities Agreement encompasses a US$138 million Construction Term Loan, a US$20 million Revolving Credit Facility for working capital, a US$20 million Cost Overrun Facility, and a US$26 million Bank Guarantee Facility to cover rehabilitation bonding. This package complements up to US$50 million in funding from South Korean steel giant POSCO, which includes a US$40 million equity investment and a US$10 million prepayment facility. POSCO’s involvement underscores the strategic importance of Mahenge within the global battery materials supply chain.
Strategic and Regional Implications
The financing supports the construction of Mahenge Module 1 and associated infrastructure, including a 220kV power line connecting the local community to the national grid. This infrastructure development is expected to unlock new business opportunities and socio-economic benefits for the region. Black Rock’s CEO, John de Vries, expressed confidence that the increased funding would bolster investor confidence and facilitate the project’s integration into global supply chains.
Looking Ahead
While the increase in funding is subject to documentation and customary conditions precedent, this milestone marks a pivotal moment for Black Rock Mining. The company is now construction-ready, backed by a robust financing structure and strategic partnerships. The Mahenge Graphite Project, with its tier-one scale and competitive cost position, is poised to become a significant player in the graphite market, particularly as demand for battery materials continues to grow.
Bottom Line?
With funding secured and timelines extended, Black Rock is poised to transform Mahenge into a global graphite powerhouse.
Questions in the middle?
- What are the remaining conditions precedent before the increased funding is fully drawn?
- How will POSCO’s expanded equity stake influence project governance and offtake agreements?
- What are the potential risks if construction timelines extend beyond the revised loan tenor?