Advanced Australian lithium developer Core Lithium (ASX: CXO) has received a non-binding indicative term sheet with the Local Jobs Fund (LJF) from the Northern Territory Government for a $5 million concessional finance facility to fund development of the Finniss lithium project.
The Northern Territory Government Local Jobs Fund (LJF) offers to invest $5 million in the Finniss Lithium Project through a lowcost business investment concessional loan (Finance Facility).
Concessional Finance Facility will contribute to lower start-up capital costs.
Finniss Lithium Project will create over 250 jobs in the Northern Territory and is expected to generate significant socio-economic benefits and enterprise opportunities.
NT Government finance building foundation for FID as Core engages with Project Finance Markets.
NT Government support boosts Core Lithium’s progress towards becoming the next Australian lithium producer.
The presentation of the Finance Facility follows an assessment process by the LJF investment committee and is a recognition of the significant employment opportunities, socio-economic benefits and enterprise opportunities in the Northern Territory to be generated from the Finniss Lithium Project.
The Finance Facility is expected to contribute to the lower start-up capital funding needs, and the concessional interest rate is expected to reduce the overall cost of finance.
Core will work with the LJF investment committee to finalise documentation and satisfy customary conditions precedent alongside a commercial project financier. Any formal offer of finance remains subject to the final recommendation of the LJF investment committee and the approval processes of the Northern Territory Government.
Core continues to engage with debt and equity capital markets in finalising the balance of the Finniss Lithium Project’s capital funding requirements. Regarding product offtake, it already has a binding agreement with China’s Yahua for 75,000tpa and a non-binding MOU with Geneva-based Transamine Trading for a further 50,000tpa, which in total represent approximately 70% of Project offtake.
Northern Territory Chief Minister Michael Gunner said the proposed financial commitment will bring new industry and jobs to the Territory. “To ensure the Territory rebounds strongly from COVID-19 the Northern Territory government is investing in projects that will help our economy grow and create jobs for Territorians.
“The Territory Government has provided Core Lithium a non-binding term sheet for a $5 million Business Investment Concessional Loan through the Local Jobs Fund, subject to due diligence.
“We are making the Territory Australia’s comeback capital, and this job-creating project can be a key part of that,” Mr Gunner said.
Core’s Managing Director, Stephen Biggins, commented: “We are delighted to have the support of the Northern Territory Government in the offer of a concessional finance facility, which contributes to the transition from developer to miner.
“The Northern Territory Government’s proposed financial commitment is a recognition of the value of the near development-ready Finniss Lithium Project and its contribution to reducing global emissions and rebound in economic growth in the Territory.”