African Minerals on Tuesday said it secured two new financing deals with the Standard Bank of South Africa to fund expansion plans at its Tonkolili iron ore project in Sierra Leone.

The Tonkolili project has a mine life of over 60 years and is expected to reach a run rate of 20m tonnes per annum (mtpa) in the second quarter this year. The firm is now working to ramp that up to 35mtpa.

The mining group established a $250m secured loan facility, structured to be able to be increased to fund the expansion.

African Minerals also secured a corporate revolving facility of $100m for general corporate purposes, replacing a $100m amortising standby facility of which $80m is currently outstanding, providing $20m of additional liquidity.

The company said the facilities would provide significant headroom and flexibility at corporate and operating levels.

Final credit committee approval was received for the establishment of the two credit facilities.

"I am delighted to report that the facilities that we outlined in December have now been approved, and am especially pleased that Standard Bank continues to be a cornerstone lender," said Chief Financial Officer, Miguel Perry.

"These facilities provide us with incremental financial flexibility through the project ramp up period, as well as a potential source of funding for the next phase of our expansion to 35 mtpa."

Shares increased 0.83% to 304.75p at 11:03 Tuesday.

RD

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