Afritin to raise £5.5m in bank debt for expansion of ISU’s first phase of development

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AFRITIN announced that it had agreed to a debt facility term sheet totaling £5.5 million (N$100 million) to frame the expansion of its Uis tin mine in Namibia.

This is the second phase of expansion of the first phase of mine development. If it continues, the plant would increase to one million tons against 840,000 tons per year currently.

Anthony Viljoen, CEO of Afritin, said the loan agreement – with the Development Bank of Namibia – would improve the concentrate recovery rate from 64% to 68%. There would also be a reduction in unit costs due to increased metal production.

“A long-term financing partnership with the Development Bank of Namibia also facilitates other financing options, which drive the growth and expansion of the entire project,” Viljoen said in a statement.

AfriTin has big plans for Uis which it hopes to develop further in a phase two expansion which will also produce metal by-products.

A Preliminary Economic Assessment (PEA) that was conducted internally by AfriTin revealed that a new phase of Uis expansion would require $440 million in capital. This would be funded by cash generated by the Uis as well as debt and an equity component.

The Uis deposit is located in Namibia and was previously mined by Iscor in the 1970s and 1980s. Afritin reopened the mine focusing on a pilot phase one tin concentrate operation which it says last year would eventually expand the operation to 2.8 million tonnes from 850,000 tonnes per year.

A phase two expansion foresees the production of 10 million tons per year of run-of-mine tin, lithium (petalite) and tantalum for a period of 14 years. There was potential to extend the mine life depending on the outcome of the exploration work.

Afritin said in its PEA that it could recoup the $440 million capital expenditure in about a year and a half. The company’s baseline assumption for the tin price was $40,500/t, which compares to a recent high of $43,949/t.

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