The Australian Government’s export credit agency has given a conditional Letter of Support for the provision of up to $300 million of debt funding for the construction of TNG’s flagship Mount Peake vanadium-titanium-iron project in the Northern Territory.
Export Finance Australia is administering the Australian Government’s $2 billion Critical Minerals Facility, which has been established to assist in funding critical minerals projects.
Mount Peake is one of 15 Australian critical minerals projects identified by the Australian Government in its Resources Technology and Critical Minerals Processing: National Manufacturing Priority Road Map.
One of the largest undeveloped vanadium-titanium-iron projects in the world, it has been awarded Major Project Status by both the Australian Government and the Northern Territory Government.
A successful outcome is contingent on several conditions including:
- meeting EFA “know your customer”, sanctions and anti-bribery requirements and checks
- provision of detailed financing proposal and independent due diligence material
- TNG making satisfactory progress towards the project’s funding plan including the raising of equity and securing funding from other lenders;
- TNG making satisfactory progress securing offtake agreements for the project’s products with counterparties acceptable to Export Finance Australia
- a contracting strategy and contractors for the engineering, construction and commissioning of the project acceptable to Export Finance Australia
- the project complying with environmental and social risk policies, including receiving the required regulatory and environmental approvals.
The tenor of the project will be supported by Mount Peake’s long project life (greater than 37 years) and JORC ore reserves.
TNG managing director and chief executive officer Paul Burton the company’s debt financing strategy was to secure a multi-source funding package consisting of government and commercial bank funding.
“Pursuing a multi-source funding strategy allows TNG to optimise its debt financing, providing greater access to low-cost lending, offering greater flexibility in loan structuring and ensuring that TNG’s funding package aligns with its development and offtake partners,” he said.
“Mount Peake is a significant critical minerals project for Australia as it will contribute to the diversification of global critical minerals supply, specifically of vanadium and titanium, and will bring more value from the critical minerals value chain to the country.”
TNG is also advancing a green energy strategy with the dual objective of offsetting carbon emissions from its planned future operations and generating new business opportunities in the alternative energy market to create additional shareholder value, with a focus on green hydrogen and vanadium redox flow batteries.