NAIF approves A$150m loan for Coburn

Project developer Strandline Resources on Monday said that the loan would be provided in two tranches, and would be based on a 15.5-year term.

The first tranche of up to A$130-million will go towards the construction of the core mine infrastructure, while the second tranche of A$20-million will fund a potential future northern access road, linking the project more directly to the Denham community in Shark Bay.

Strandline told shareholders that the NAIF’s positive investment decision was further confirmation of the robust long-term financial returns to be generated from the Coburn project.

“NAIF’s investment decision is a major endorsement of the project and positions the company ell to advance towards production. As well as providing a substantial share of the project funding, NAIF’s support will help ensure Coburn secures the rest of the necessary financing,” said MD Luke Graham.

“Coburn will be a significant contributor to the economy of the Gascoyne and Mid-West regions in Western Australia and a large employer from the surrounding communities for many years to come.

“With the key development approvals in place, binding offtake contracts signed with major customers, and a significant portion of the development funding secured via the NAIF loan, Coburn is moving rapidly towards development,” Graham said.

Located 240 km north of Geraldton, the Coburn project has ore reserves of 523-million tonnes and an initial mine life of 22.5 years at a planned average mining rate of 23.4-million tonnes a year.

Products from the development will be used globally in items including ceramic tiles, refractory, paint, titanium metal and welding rod applications. First production is expected within 18 months of the start of project construction.

“At a critical time for the Northern Australia economy, NAIF’s support for the Coburn project will provide jobs and investment into our important resources sector,” said NAIF CEO Chris Wade.

“This loan means NAIF has now approved more than A$2.1-billio n in loans to projects right across the north, with A$1.2-billion approved in the last 12 months. The mineral sands sector offers exciting potential for Northern Australia and we are delighted to support that with approval of investment towards what is considered one of the world’s largest and capital-efficient mineral sands projects.”

Following NAIF’s approval, the loan will now be considered by the Minister for Resources, Water and Northern Australia and the Western Australia Government.