The company has also secured approval for a A$19.5 million concessional loan from the Australian Government’s Northern Australia Infrastructure Facility (NAIF).

The US$15 million working capital facility and foreign exchange facility, which were contemplated when the Company executed the Nordic Bond facility last year, have been secured with BNP Paribas, a globally recognized bank with a stable A credit rating from Standards and Poor (S&P) and a stable Aa3 from Moody’s. The facilities will support prudent risk and capital management during Pilbara Minerals’ growth phase, coinciding with the commissioning and ramp up phases for Stage 1 of the Pilgangoora Lithium-Tantalum Project (Pilgangoora Project) and the proposed Stage 2 (5Mtpa) expansion of the project.

Commenting on the facilities with BNP Paribas, Pilbara Minerals’ Managing Director and CEO, Ken Brinsden, said: “We welcome the relationship with BNP Paribas, one of the leading metals and mining banks. BNP Paribas’ offer to Pilbara Minerals for the provision of the working capital and foreign exchange hedging facilities was competitively priced and demonstrates their strong commitment to developing a long-term partnership with the Company in support of our growth ambitions.”

In addition to this facility, the recent indicative commitment from NAIF for a A$19.5 million loan facility to assist in funding the upgrade of the Pippingarra Road, a public road connecting the Pilgangoora Project to port infrastructure in Port Hedland, is also a significant positive development. The financial support from the Australian Government through NAIF will enable Pilbara Minerals to improve the operations of the Pilgangoora Project by allowing increased haulage payloads via larger trailer configurations to Port Hedland port to deliver product to market. It will also facilitate the Pilgangoora Project’s expansion, particularly the proposed Stage 2, 5Mtpa operation.

Commenting on the NAIF commitment, Ken Brinsden, said: “The upgrade of the Pippingarra Road provides a range of benefits for the local community and for the Pilgangoora Project. The upgrade removes the need to traverse three significant rail crossings when hauling product to Port Hedland, supporting safer and more efficient haulage operations. It also significantly improves safety by reducing the interaction between light and heavy vehicles, and keeps heavy vehicles associated with mining operations in the Pilgangoora region off a long section of the busy Great Northern Highway.”

The NAIF concessional loan is subject to final documentation and customary conditions precedent to drawdown, including final sign off from the Western Australian State Government. During this time, Pilbara Minerals will continue to work through the remaining approvals and associated tasks required to undertake the Pippingarra Road upgrade.

The facilities from BNP Paribas and NAIF are additional and complementary to the funding sources expected to be available to Pilbara Minerals to finance the A$231M capital development cost (plus any additional working capital requirements) required to execute the Stage 2, 5Mtpa expansion of the Pilgangoora Project.

Following the completion of the Stage 2 (5Mtpa) definitive feasibility study for the Pilgangoora Project, Pilbara Minerals has continued to engage with its customers, Ganfeng Lithium and Great Wall Motors, on Stage 2 offtake linked funding arrangements in the form of either cash pre-payment or debt finance facilities. Those discussions are progressing as planned, and the Company is considering in parallel with this customer financing several funding proposals from both the bond and debt capital markets.

Pilbara Minerals’ financial adviser in relation to the NAIF and BNP Paribas facilities was BurnVoir Corporate Finance.

Source: Company Press Release