Nouveau Monde Graphite (NMG) has received letters of interest (LOIs) for more than C$1bn ($731.3m) in project debt financing to fund the company’s phase-two Matawinie Mine and Bécancour Battery Material Plant in Québec, Canada.
The financing structure is expected to include contributions from syndicate institutional funds and export credit agencies.
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The company’s updated feasibility study, released earlier this year, confirmed the technical and economic viability of its integrated graphite projects, boasting an after-tax internal rate of return of 17.5% and a net present value of C$1.05bn.
With this foundation, NMG is moving towards a final investment decision (FID) for phase two of its operations.
Export Development Canada (EDC) has expressed interest in providing up to C$430m.
The Export–Import Bank of the United States has also issued an LOI for $172m under its Supply Chain Resiliency Initiative (SCRI).
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By GlobalDataThe SCRI is designed to diversify US supply chains, reduce dependency on China, and bolster US national and economic security while creating US jobs.
Additionally, more than $481m in potential support has been indicated by undisclosed parties. While details remain confidential, these discussions underscore the strategic and economic importance of NMG’s project.
NMG founder, president and CEO Eric Desaulniers said: “We have been extremely busy in the past weeks to present the results of our Updated Feasibility Study and engage with our financial stakeholders to advance our project financing. Feedback has been positive as demonstrated by the quality of lenders rallying behind our business plan.
“Economies around the world are seeking opportunities to relocate and secure critical minerals mining and processing to enable local manufacturing, economic resilience, energy autonomy and national security.”
NMG is actively engaging with various governmental bodies and public institutions to finalise the overall debt funding package.
The anticipated debt structure is in line with NMG’s financing projections and contemplates long-term debt or guarantees with a maturity beyond ten years.
The non-binding LOIs are a precursor to finalising a term sheet and are part of a broader financing strategy that includes equity financing and fulfilling conditions precedent.
While negotiations continue, there is no certainty that final agreements will be reached or that funding will be secured.
Specialised advisory firms are conducting due diligence to assess corporate, technical, market and environmental, social and governance aspects of the phase-two operations.
The results of this due diligence will inform the structuring of legal documentation and the project debt package before the investment committee reviews.
NMG is also preparing for an FID by advancing technical documentation, negotiating supplier contracts and preparing for construction tenders.
In December last year, NMG received $50m in equity investment from the Canada Growth Fund and the Government of Québec, through Investissement Québec, to support its graphite operations.
