Northern Graphite intends to start production at the Okanjande mine in Namibia by the end of 2024 once financing becomes available.
The Okanjande mine and the Okorusu processing project went into care and maintenance in 2018 before Northern Graphite’s acquisition from the Imery’s Group in 2022.
There are now 15 employees advancing the Namibian operations after the retrenchment of 32 others.
According to Northern Graphite’s third-quarter results, the Okanjande and Okorusu care and maintenance have cost US$ 400,000.
Northern Graphite wants to move the processing plant from Okorusu to Okanjande, about 78km, instead of rehabilitating the mill.
In August 2023, Northern Graphite said a preliminary economic assessment showed that it would be cheaper to operate the plant if moved to Okonjande, albeit the envisaged higher capital costs.
“A full development schedule can be executed within 12 to 14 months once financing is available, intending to resume production by the end of 2024,” the company said.
The company also announced the completion of a US$3m deal with Sprott Resource Streaming and Royalty Corp consisting of US$1m in secured debt and US$2m in royalty financing.
The financing was completed through amendments to Nothern Graphite’s senior secured credit agreement and royalty agreement entered into with Sprott in April 2022 in connection with the funding the acquisitions of the Lac des Iles graphite mine in Quebec and the Okanjande graphite mine.
Under the senior secured credit agreement amendments, Northern Graphite has obtained a senior secured loan for US$1m, in addition to the US$12m previously made in April 2022.
Northern Graphite has exercised options under the agreement to capitalise the cash interest payments due on the loan up until 31 December 2023 and add it to the principal amount of the loan, which will result in the principal amount of the loan being approximately US$14.6m after giving effect to the capitalisation of the interest.
