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Highlights
- Lindian Resources (LIN) signs a US$50 million funding and offtake term sheet.
- Gerald Group to support the development of Kangankunde Rare Earths Project.
- Feasibility study showcases low-cost structure with significant economic potential.
Lindian Resources (ASX:LIN) has taken a significant step in advancing its world-class Kangankunde Rare Earths Project in Malawi by signing a US$50 million non-binding funding and offtake agreement with Gerald Group. This package aims to support the initial phase of development for the rare earths project, which has shown promising feasibility and low-cost projections.
The non-binding term sheet outlines Gerald Group’s provision of US$50 million to fund the first stage of Kangankunde's development. This package will be used to cover pre-production capital costs, operational expenditure, and the creation of an initial run-of-mine stockpile. The agreement includes both equity and convertible instruments, as well as prepayment loan facilities, with repayment expected through the supply of monazite concentrate from the project.
According to Lindian’s CEO, the collaboration with Gerald Group highlights the global recognition of the project’s potential. The Kangankunde project is positioned as one of the lowest-cost rare earth projects globally, with a feasibility study revealing pre-production capital costs of approximately US$40 million. Additionally, the study confirmed a robust economic profile with low operating costs and a long mine life.
The agreement grants Gerald Group exclusive offtake rights for monazite concentrate from the first phase of production, along with partial rights for the second phase. The funding arrangement also allows Gerald to nominate directors to Lindian’s Malawi subsidiaries and the company’s board upon the first tranche of funding becoming effective.
Gerald Group, a global metals trading company headquartered in London, has over six decades of expertise in the physical merchanting, financing, and development of metals and commodities. With gross revenues of around US$10 billion, the group specializes in a wide range of metals, including aluminum, copper, and rare earth elements, providing end-to-end commodity services from sourcing to logistics and risk management.
Lindian continues to finalize the binding terms of the agreement while Gerald completes its due diligence. This collaboration is expected to play a pivotal role in accelerating Kangankunde’s development, with construction activities targeted for early 2025.
The Kangankunde Rare Earths Project holds strategic importance due to its low-cost profile and the growing global demand for rare earth materials used in green technologies and advanced industries.
