Arafura Rare Earths has obtained conditional approval for up to $115m (€106.5m) in loan guarantees from the German Government's Inter-Ministerial Committee (IMC) for its Nolans project in Australia's Northern Territory.
These guarantees, provided by German ECA Euler Hermes, are set to bolster Arafura's position as a major supplier of REEs outside of China.
The ten-year untied loan guarantees will aid in the debt financing of the Nolans rare earths project, ensuring a steady supply of neodymium and praseodymium (NdPr) to Germany-based companies, including Siemens Gamesa.
This development is a strategic move to establish Arafura as a key player in the global rare earths market.
Arafura has stated that the backing from Euler Hermes marks the final German ECA approval required to complete the senior debt structure for the project. This support is pivotal in finalising the targeted $775m senior debt funding with commercial lenders.
The miner needs to uphold ECA-linked offtake agreements throughout the loan's duration.
Arafura managing director Darryl Cuzzubbo stated: “Today Arafura reached another significant milestone in announcing conditional approval of US$115m in untied loan guarantees from Euler Hermes.
“We continue to demonstrate the increasing geostrategic importance of the Nolans project and developing a diversified global NdPr supply chain, this time by securing German export credit agency support. This agreement is linked to offtake with German-based companies, including our key customer Siemens Gamesa, who are global leaders in building wind turbines to advance the energy transition.”
Earlier this week, Arafura received conditional approval for a $150m (A$223m) debt financing package from the Export-Import Bank of Korea (KEXIM) for the Nolans project, preceded by $300m in debt funding approval from Export Development Canada in May.
The Nolans project is a rare earth ore to oxide mining and processing facility, which includes a mine, process plant and associated infrastructure at a site 135km north of Alice Springs in the Northern Territory.
