Canadian company GoviEx Uranium has received expressions of interest from export credit agencies and project finance banks to arrange $220m of senior debt financing for the construction of Madaouela uranium project in Niger.
The development comes after the company appointed Medea Capital Partners as project debt advisor earlier this month.
Debt financing is dependent on the release of bankable feasibility study for the project, which is situated south-east of the mining town of Arlit.
GoviEx Uranium executive chairman Govind Friedland said: “The level of interest shown by the export credit agencies and the banks to provide financing accretes confidence in the Madaouela project.
“We will now proceed to the detailed due diligence phase with the various groups, while at the same time moving forward on the other parts of our four-stage strategy.”
The company noted that the expressions of interest are under review and negotiations will be held with the potential lenders, in order to determine the appointment of mandated lead arrangers for implementing debt financing of the Madaouela project.
Other conditions for the debt financing include long-term off-take contracts to be signed with nuclear utility counterparties, as well as export credit agency insurance cover being in-place, depending on the nationality of either the off-take and/or procurement counterparties.
The expressions of interest are subject to final due diligence, credit committee, and board approvals, in addition to negotiation of final loan documentation.
Based on a technical economic analysis, the project is understood to have an after-tax net profit value (NPV) of $340m at an 8% discount rate with an internal rate of return (IRR) of 21.9%.
With an 18-year mine-life, the project is expected to produce a total of 45.6 million pounds U3O8, with U3O8 yellowcake production rate of 2.69 million pounds per annum.