Arafura Rare Earths has achieved a major milestone with 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. Provided by German ECA Euler Hermes, these guarantees are crucial for bolstering Arafura’s role as a leading supplier of Rare Earth Elements (REEs) outside of China.
The ten-year untied loan guarantees will support the debt financing of the Nolans rare earths project, ensuring a stable supply of neodymium and praseodymium (NdPr) to Germany-based companies, including Siemens Gamesa. This strategic move is aimed at solidifying Arafura’s position in the global rare earths market.
According to Arafura, the backing from Euler Hermes marks the final German ECA approval needed to finalize the senior debt structure for the project, facilitating the targeted $775m senior debt funding with commercial lenders. Arafura Managing Director Darryl Cuzzubbo emphasized the significance of this approval, stating, “Today Arafura reached another significant milestone in announcing conditional approval of US$115m in untied loan guarantees from Euler Hermes.”
Earlier this week, Arafura also secured conditional approval for a $150m (A$223m) debt financing package from the Export-Import Bank of Korea (KEXIM) for the Nolans project, adding to the $300m in debt funding approval from Export Development Canada received in May.
The Nolans project, located 135km north of Alice Springs in the Northern Territory, encompasses a rare earth ore to oxide mining and processing facility, including a mine, process plant, and associated infrastructure.