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Black Rock Mining completes Mahenge debt financing with US$179m facility from African banks

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By Imelda Cotton - 
Black Rock Mining ASX BKT Mahenge funding Tanzania
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Tanzanian explorer Black Rock Mining (ASX: BKT) and its subsidiary Faru Graphite have secured a facilities agreement with three African banks to provide US$179 million in funding to develop the Mahenge graphite project.

The deal was signed with the Development Bank of Southern Africa (DBSA), the Industrial Development Corporation of South Africa (IDC) and Tanzanian lender CRDB Bank (CRDB).

It comprises a US$113 million construction term loan for Mahenge Module 1 and associated infrastructure, a US$20m revolving credit facility for working capital, a US$20m cost overrun facility and a US$26m bank guarantee facility.

‘Major de-risking’

This agreement adds to a US$50m loan committed earlier this month by South Korean steel conglomerate POSCO International, comprising a US$40m equity investment in Black Rock and a US$10m prepayment facility.

Black Rock chief executive officer John de Vries said the company had now concluded the debt financing stage for Mahenge.

“We are extremely pleased to have signed this agreement with a group of such high calibre lenders,” he said.

“Today’s announcement represents a major de-risking milestone towards funding of Mahenge and we look forward to working with DBSA, IDC and CRDB to develop this project for the benefit of all our stakeholders.”

Sustainable development

DBSA is wholly owned by the government of South Africa and is one of the region’s leading development finance institutions.

It aims to accelerate sustainable socio-economic development in the country and wider sub-Saharan Africa by driving financial and non-financial investments in the social and economic infrastructure sectors.

IDC is a state-owned bank that provides businesses with financial support to promote economic growth and development in South Africa.

CRDB is Tanzania’s largest commercial bank, established in 1996 to serve businesses and corporates in the markets of Tanzania, Burundi and the Democratic Republic of Congo.

The bank was accredited by the UN Green Climate Fund in 2019 and last year became the first bank in sub-Saharan Africa to issue the largest green bond aimed at raising funds to support environment-friendly projects.