Arafura receives Germany nod for up to $115 million loan

Arafura Rare Earths has received conditional approval from a German government inter-ministerial committee for up to $115 million in loan guarantees for its Nolans project, the Australian rare earths miner said on Thursday.

The company has secured several debt facilities after Prime Minister Anthony Albanese said in March that Australia would contribute up to A$840 million ($563.56 million) for the project, the first combined rare earths mine and refinery in the Northern Territory.

The announcement came as Australia and its allies diversify the global supply chain for rare earths after Covid-related snarls highlighted China-linked supply risks. China produces more than 80% of the world’s rare earths.

The untied loan guarantees from German export credit agency Euler Hermes are over a 10-year tenor, Arafura said in a statement.

Earlier this week, Arafura said the Export-Import Bank of Korea conditionally approved up to $150 million in debt financing for the Nolans project.

At the end of May, Export Development Canada gave conditional approval for $300 million in debt financing for the project.

($1 = 1.4905 Australian dollars)

(By Adwitiya Srivastava; Editing by Subhranshu Sahu)