31 August 2021
Pensana Plc
("Pensana" or the
“Company")
Update on site
development, Financing and Investor Webinar
Pensana Plc is pleased to provide an investor update following a
recent Board Meeting held at the Saltend Chemicals Park (“Saltend”)
in Humber Freeport, Northern
England.
Pensana’s US$125 million plant
will be the first major rare earth separation facility to be built
in over a decade and the first to be located in a Freeport. It will become an important hub in
establishing an independent magnet metal supply chain for the UK
and beyond, creating over 100 high value direct jobs and over 500
jobs during construction.
Site developments under way at Saltend
and Longonjo
At the Saltend project in Humber, UK:
- Front End Engineering Design (FEED) is advancing per schedule
and expected to be complete in October. Thereafter EPCM contracts
are expected to be awarded.
- Pensana has entered into a 25-year lease agreement with pxGroup
and Associated British Ports (ABP) for the initial nine-hectare
Saltend site with scope for expansion.
- Geotechnical drilling and trenching works have commenced. These
will confirm input data for the completion of foundation design for
the processing plant buildings and infrastructure.
- Wood, the international engineering group, is working with
pxGroup to optimise jetty to site reagent and material handling
arrangements along with the provision of ‘plug and play’ power,
water, steam and fuel supplies.
- Pensana is also in discussions with Freeport stakeholders from pxGroup, ABP and
KPMG to finalise government submissions to clarify of the benefits
and incentives applicable to the Freeport enterprise zone tax and customs zone
for the Saltend Chemicals Park.
At the Longonjo project in Angola:
- Front End Engineering Design (FEED) is again advancing per
schedule and expected to be complete in October with EPCM contracts
awarded thereafter.
- The Lidar survey for the complete site (inclusive of
surrounding bulk service infrastructure and the transmission line
providing connection to hydro-electric power) has now been
completed along with hydrological studies of water supply and 100
year floodline assessments.
- Detailed geotechnical investigation, under the supervision of
global specialists SRK, has been mobilized. It will confirm final
plant and infrastructure foundation design, tailings storage
facility and pit stability criteria which have been based on
previous broader area campaigns.
ATF Funding
The Company’s expression of interest in the UK Government’s up
to £1bn Automotive Transformation Fund (“ATF”) has been received
positively by the programme board. The application for grant or
other forms of financial support is currently under government
review.
The Company does not have any indication on the timing of any
potential award, however it will advise shareholders as soon as
advice is received.
Bond Financing for the Saltend rare
earth separating facility in Humber, UK
Pensana has engaged ABG Sundal Collier (ABGSC), a leading Nordic
investment bank headquartered in Oslo,
Norway, to progress the debt financing.
ABGSC is a premier investment bank in the Nordic market with an
extensive track record in the Nordic high yield market and broad
natural resources sector expertise and debt structuring. The
transaction will be supported by ABGSC’s top ranked credit research
team, delivering unique investor education and credit story
marketing.
With broad natural resources sector expertise, capital markets
and debt structuring experience alongside extensive capabilities in
negotiating intercreditor terms with government agencies, ABGSC is
well placed to assist in the execution of the proposed bond
issuance.
The envisaged senior debt facilities under discussion comprise a
senior secured first lien facility amount of up to US$250 million over a five-year term.
ABGSC will be initiating their detailed due diligence review
shortly and will look to be in a position to target a bond issuance
during Q4 2021 once FEED and site preparation is complete.
Offtake and Marketing Agreements
Discussions have commenced with a number of prospective offtake
partners with a view to securing offtake and/or marketing
agreements to support the main financing. To date non-disclosure
agreements have been executed with three interested parties and
discussions have been initiated with several more.
Investor Webinar
Pensana will hold an investor webinar at 08:00 UK on Wednesday 8
September. Investors may register and submit questions ahead of the
webinar using this link:
https://www.investormeetcompany.com/pensana-plc/register-investor
Chairman Paul Atherley commented
“We continue to work closely with the UK Government’s Automotive
Transformation Fund on support for the world-class Saltend rare
earth processing hub which will create over 500 jobs during
construction and over 100 high value permanent jobs once in
operation.
Saltend will be the first major rare
earth separation facility to be developed in over a decade and will
be the first to be located in a Freeport. The facility will process feedstock
from the Company’s Longonjo project and from other sources around
the world, producing the magnet metal oxides critical for the EV
and offshore wind turbine supply chains.”
For further
information: |
|
Pensana
Plc |
|
Website:
Paul Atherley, Chairman / Tim George, CEO |
www.pensana.co.uk
contact@pensana.co.uk |
About Pensana
The electrification of motive power is the most important part
of the energy transition and one of the biggest energy transitions
in history. Magnet metals are central to the transition and
critical to high value manufacturing applications such as electric
vehicles and offshore wind turbines.
Pensana plans to establish Saltend as an independent,
sustainable supplier of the key magnet metal oxides to a market
which is currently dominated by China. The US$125
million Saltend facility is being designed to produce circa
12,500 tonnes per annum of rare earth oxides, of which 4,500 tonnes
will be neodymium and praseodymium (NdPr), representing around 5%
of the world market in 2025.
The Saltend facility is located within the world class Saltend
Chemicals Park, a cluster of leading chemicals and renewable energy
businesses at the heart of the UK’s energy estuary, and host to a
range of companies including BP Petrochemicals technology, INEOS,
Air Products, Triton Power, Nippon Gohsei and Tricoya.
Pensana’s plug and play facility will create over 500 jobs
during construction and over 100 direct jobs once in production. It
will be the first major separation facility to be established in
over a decade and will become one of only three major producers
located outside China.
Initial feedstock will be shipped as a clean, high purity mixed
rare earth sulphate (MRES) from the Company’s Longonjo low impact
mine in Angola. The open-cast
mine, state-of-the-art concentrator and proprietary MRES processing
plant are being designed by Wood to the highest international
standards. They will be powered by minimal carbon hydro-electric
power and connected to the Port of Lobito by the recently upgraded
Benguela railway line.
Pensana is of the view that provenance of critical rare earth
materials supply, life cycle analysis and GHG Scope 1, 2 and 3
emissions will all become significant factors in supply chains for
major customers. The Company intends to offer customers an
independently and sustainably sourced supply of the metal oxides
and carbonates of increasing importance to a range of applications
central to the energy transition, industrial, medical, military and
communications sectors.
For many miners around the world who are looking to access the
European and US supply chains, it is becoming increasingly clear
that the proposed EU and possible UK carbon border taxation would
mean that it is no longer acceptable for manufacturers to source
material extracted or processed unsustainably.
Pensana is aiming to establish Saltend as an attractive
alternative to mining houses who may otherwise be limited to
selling their products to China,
having designed the facility to be easily adapted to cater for a
range of rare earth feedstocks.