CRDB secures 790bn/-investment for Mahenge Graphite project
TANZANIA: CRDB Bank has achieved a milestone by securing a historic 790bn/- investment for the Mahenge Graphite Mining Project, with the government holding a significant 16 per cent stake.
This landmark investment positions CRDB, the largest lender in the country, as a central player in the project, assuming key roles as the joint mandated lead arranger, facility agent, onshore account bank, and onshore security agent.
The project is set to drive substantial economic benefits, fostering growth and development in the Mahenge and Ulanga regions while contributing to national prosperity.
“We are deeply committed to supporting strategic projects that drive sustainable development and create lasting impact,” CRDB Group CEO and Managing Director Abdulmajid Nsekela said in release over the weekend from South Africa.
This milestone marks a key step forward in the development of this critical project and solidify the availability required of a debt funding of 153 million US dollars and further 26 million US dollars in the form of a bank guarantee to support the rehabilitation bond for the mine closure plan hence making a total of 290 million US dollars (790bn/-) for the entire project—Faru Graphite Corporation.
Mr Nsekela said the lender involvement in the Mahenge Graphite Project demonstrates CRDB unwavering belief in the potential of Tanzania and Africa at large.
“By working together with leading institutions, we are not only funding a critical supply chain for battery minerals but also empowering local communities with jobs, infrastructure, and business opportunities.
“This project is a testament to what can be achieved when we invest in Africa’s future,” CRDB head said.
Additionally, the loan facility is provided under a consortium with CRDB playing a central role as the joint mandated arranger, facility agent, onshore account bank, and onshore security agent, committing a total of 66 million US dollars. The Development Bank of Southern Africa (DBSA) has committed 59.6 million US dollars, while the Industrial Development Corporation (IDC) has committed 53.4 million US dollars.
The project needs both equity investments and off-take prepayments—with POSCO potentially involved—and has received significant financial support totaling 179 million US dollars for the initial stage.
This backing, according to Mr Nsekela, is crucial for reducing risks and showcases the confidence and commitment of the banks involved in supporting projects that contribute to long-term development and economic progress.
Black Rock’s CEO John de Vries said they are extremely pleased to have concluded their debt financing process for Mahenge Graphite Project and to be signing the facilities agreement with a group of such high calibre lenders.
“Today’s [last Friday] announcement represents a major de-risking milestone for Black Rock towards funding the development of the Mahenge Graphite Project.
“We look forward to working with DBSA, IDC, and CRDB to develop Mahenge for the benefit of all our stakeholders,” Mr de Vries, Faru Graphite Corporation’s majority shareholder, said.
The Faru Graphite Project stand to be one of the exciting projects to fund at this era. Promising for a significant economic and environmental benefits to the country and to the world at large by providing a potential supply of batteries minerals (natural graphite) which play a crucial role in reducing carbon footprints through several key applications and mechanisms.
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The project is poised to bring massive multiplier socio-economic incentives such creating over 500 directly and indirectly employment opportunities, accessibility of power through the construction of 220Kv powerline connected from Ifakara substation to supply to the Mahenge Graphite Project which includes the broader regional electrification of local villages within the Mahenge and Ulanga districts, Morogoro.
The project also brings a substantial value chain opportunities to suppliers, service providers including and not limited to local mining construction companies, logistics companies, importers, traders and retailers in Mahenge.
The Mahenge Graphite, Faru Graphite Corporation, is a significant mining venture between the Australian Securities Exchange (ASX) listed Black Rock Mining (84%) and Tanzania (16%) developed on the world-class multigenerational. This project aims to develop and exploit high-quality graphite deposits, a critical mineral with substantial applications in battery technology, energy storage, and various industrial processes.
