London-listed magnet metal supply chain developer Pensana has secured full financing approval for its Longonjo rare earth project in Angola. The funding, totaling approximately $268 million, will facilitate the development of one of Africa’s most promising rare earth mining operations.
The board of the Africa Finance Corporation (AFC) has approved an $81.2-million contribution to a $160-million syndicated loan facility, in partnership with South African financial services provider Absa Bank. This loan facility will cover approximately 60% of the required Phase 1 funding, subject to definitive loan documentation and other conditions precedent.
South African Phosphate Mine Sector Sees Growing Investment Interest
While Pensana’s Longonjo project is a rare earth mining initiative, the increasing financial backing for resource development in Africa, including the South African phosphate mine sector, highlights growing investor confidence in the region’s mineral potential. The balance of Longonjo’s Phase 1 funding will be provided through equity investments, with the Angolan Sovereign Wealth Fund (FSDEA) committing $38 million in equity and a convertible loan, while AFC has approved an additional $54.9 million in convertible loan financing.
FSDEA’s latest investment follows a $15-million bridging loan previously provided to Pensana, reinforcing Angola’s commitment to advancing its mining sector. The equity investments at the subsidiary level remain subject to final agreements and standard conditions precedent.
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Strategic Impact on the Mining Industry
Pensana chairperson Paul Atherley emphasized the Longonjo project’s economic and social impact, stating: “The Longonjo project will produce an average of around 20,000 tonnes per year of high-value mixed rare earth carbonate (MREC). It will create over 430 high-value processing jobs, with over 50% allocated to young people while supporting local businesses, service providers, and farmers.”
AFC president and CEO Samaila Zubairu added: “At AFC, we recognize the immense strategic value of Africa’s resources – not just for our economic transformation but for securing diversified, sustainable supply chains. By investing in Africa’s rare earth sector, we are accelerating regional development and strengthening global energy security.”
FSDEA chairperson Armando Manuel echoed these sentiments, stating that the project plays a crucial role in Angola’s mining sector by supporting economic diversification and tax revenue generation. “With support from Absa and AFC, this initiative aims to foster sustainable growth, enhance local capabilities, and reinforce Angola’s position in the international mining landscape,” he noted.
Longonjo Project and Global Mining Outlook
The Longonjo project consists of an open-pit mine, concentrator, and recovery plants designed to produce MREC for export via the Lobito port, strategically located next to the Lobito rail corridor. The financing approval has significantly boosted investor confidence, reflected in Pensana’s share price surge to 40.9p on the London Stock Exchange, compared to the March 17 closing price of 27.9p.
As investment in Africa’s mining industry continues to expand, the success of projects like Longonjo signals potential growth for the South African phosphate mine sector and other key mineral developments across the continent. With increasing global demand for critical minerals, Africa’s mining landscape is set for continued transformation, attracting new investors and driving sustainable economic growth.
