Pensana (LSE:PRE) has received tranche one of a US$165 million ($230 million) strategic investment, totalling US$15 million, to support the company’s US mine-to-magnet strategy.
The investment, provided by Cascade Natural Resources, will support the development of the Longonjo Mine in Angola, as well as add the heavy rare earth circuit and expand the resource base to a target of one billion tonnes.
Under the terms of the investment, Pensana will issue 13.99 million shares at £0.80 per share, representing a 3.8% stake in the company, as well as a US$150 million investment in Pensana’s subsidiary, representing a 38.2% interest.
Chairman Paul Atherley says expanding the resource at Longonjo will make it one of the “largest rare earth mines ever developed”.
“A recent report from the International Energy Agency (IEA) has highlighted the need to build a robust and resilient international rare earth supply chain to reduce the world’s reliance on China to avoid US$6.5 trillion of potential economic cost of supply disruptions,” Atherley says.
“With construction well underway and first production scheduled for 2027, our investment in Longonjo and our plans to establish a fully integrated US mine-to-magnet supply chain will be an important step in securing this supply.”
Alongside the proposed US$160 million ABSA debt funding package, the strategic investment will provide the construction of the Longonjo Mine, including executing a drilling program and constructing the heavy rare earth element recovery facility ahead of the mine’s first production scheduled next year.
Funding will also be used for downstream development initiatives, the costs associated with a proposed Nasdaq listing, and corporate costs.
Cascade Natural Resources is an investment fund backed by specialist family offices and major sovereign funders.
Pensana is focused on developing a large, ‘high-grade’ magnet metal rare earth mine which will initially produce 20,000 tonnes per year of clean, high-value mixed rare earth carbonate including light rare earths and heavy rare earths.
The plan is to expand production to 40,000 tonnes per year of mixed rare earth carbonate once initial operations have been established.
Write to Aaliyah Rogan at Mining.com.au
Images: Pensana
