AfriTin Mining Limited (AIM: ATM), an African technology metals mining company with a portfolio of mining and exploration assets in Namibia, is pleased to announce that its majority-owned subsidiary, Uis Tin Mining Company (Pty) Limited (“UTMC”).
Has entered into a conditional, credit approved, term sheet for a lending facility with the Development Bank of Namibia Limited (“D evelopment B ank of Namibia ” ) to fund the Uis Phase 1 Stage II Continuous Improvement Project. (” Lending Facility “).
· Proposed Lending Facility comprises a NAD 100 million (approximately GBP 5.5 million) Senior Secured Lending Facility with the Development Bank of Namibia;
· It is intended that the Lending Facility will be used to fund the scope of work covered in the Uis Phase 1 Stage II Continuous Improvement Project;
· The Lending Facility, would be used to compliment the expansion project that is already in progress and which is expected to achieve the following targets:
o Increase plant throughput from 840 ktpa to 1Mtpa;
o Improve processing efficiency to maximise recovery rate of concentrate from current 64% to 68%;
o Promote business sustainability through enhancement of support infrastructure; and
o Reduction of unit cost of production.
· The Phase 1 expansion commissioning remains on track, to be completed during Q3 2022.
Although the Lending Facility has been approved by the credit committee and board of the Development Bank of Namibia, there are certain conditions precedent that need to be adhered to, including completion of final legal documentation. At this stage there can be no guarantee the Lending Facility will be entered into, or that any money will be drawn down, but the AfriTin Management and the Development Bank of Namibia have every confidence that it will be.
Anthony Viljoen,(CEO) commented: “We are pleased to announce the headline terms for a proposed lending facility with the Development Bank of Namibia. This new strategic financing partnership reinforces our commitment to developing long-term relationships within Namibia and ultimately will be to the benefit of the people of Namibia. A long-term financing partnership with the Development Bank of Namibia also facilitates further financing options, that drive the growth and expansion of the entire project. We look forward to advancing this lending facility with the Development Bank of Namibia, and contributing to the long-term sustainable development goals of the country. We will be providing further updates in due course.”
Martin Inkumbi, Development Bank of Namibia CEO, commented: “Our main objective as an institution is to contribute to the economic growth, social development and sustainable welfare of Namibia and its people. We look forward to working with AfriTin and UTMC.”
UTMC has agreed an initial term sheet of NAD 10 0 million (approximately GBP 5 .5 million) for a proposed Lending Facility with the Development Bank of Namibia . The headline terms include the following:
· Loan term of 10 years;
· Ranked as senior secured debt (the intention is it will rank pari passu to the Standard Bank Namibia loan, subject to their consent);
· For the first 12 months after execution, there will be no interest or capital repayments required;
· Interest accrues at Namibian prime lending rate (currently 8.5%) plus 2.5% per annum (currently equal to 11.0%);
· First drawdown to occur no later than 90 days from date of signature of the Proposed Lending Facility agreement;
· Front end fee of 1.5% of facility amount is payable, either upon first drawdown or 30 days from stipulated drawdown period, if not drawn; and
· Early repayment is subject to a 1% penalty charge on any outstanding sums.
It is intended that the Lending Facility would be secured pari passu to the security held by Standard Bank Namibia and, if drawn down, the monies would be used for the implementation of the Company’s continuous improvements. As set out above, a final agreement is subject to, amongst other things, the satisfaction of certain conditions, the provision of certain papers and legal opinions, and the negotiation of documents. A further announcement will be made if and when the documents are executed (expected before 28 July 2022 when these terms expire).
Uis Phase 1 Stage II Continuous Improvement Project Summary
The scope of the Uis Phase 1 Stage II continuous improvement project includes increasing the crushing capacity of the fines crushing section to ensure consistent feed to the concentrator, as well as removing potential stream and downstream delays that may affect production. To ensure higher recovery of minerals, the intention is that the visibility of the plant operating parameters must be improved, and the rate of metallurgical sampling will be increased to enhance metal accounting.
If the Lending Facility detailed in this announcement is executed, the project capital will also be applied to upgrading the existing mine support infrastructure. This upgrade would ensure that the Company establishes an environment that is conducive to enhancing employee performance. Opportunities to dilute operating fixed costs have also been identified, namely, procurement of spares, discard loading bins, access road construction, road maintenance and improved supply chain, all without compromising production schedules.
This project has already commenced utilising existing cash resources of the Company, with the appointment of an implementation team, and recruitment of engineering detail to facilitate procurement and fabrication. Further updates will be made in due course.
AfriTin Mining Limited
+27 (11) 268 6555
Anthony Viljoen, CEO
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