• London
  • Vancouver
  • Camana Bay

US$190mTransaction amount

Kwale Mineral Sands Project / Base Resources

Endeavour advised Base Resources on the project financing of the Kwale Mineral Sands Project in Kenya.

Background

Endeavour advised Base Resources on the project financing of the Kwale Mineral Sands Project in Kenya. The project was the first mining project finance ever in Kenya, a country with no history of large scale mining.

Comprehensive role advising the project sponsor including:
  • Development of a financing plan and contractual structure
  • Documentation negotiations
  • Negotiations with offtake counterparties
  • Supporting Government negotiations and processes
  • Supporting the company with the conditions precedent to achieve drawdown and closing of the financing

Key Contacts

David Rhodes

Managing Director


Challenges

  • Junior sponsor issues
  • Country risk  –  Kenyan 35% indigenisation law
  • Perfecting Security in Kenya
  • Market /offtake risk on a mineral sands product with no terminal markets
  • Co-ordination of a diverse financing group including DFIs, commercial banks and equipment vendors

Solutions

  • Negotiated cost overrun facility and completion guarantee
  • Comprehensive independent legal and technical due diligence
  • Investment Agreement with Kenyan Government
  • Negotiated offtake agreements incorporating floor price arrangements with creditworthy offtakers
  • Political Risk Insurance cover for commercial Lenders
  • Involvement of DFIs from OECD countries

Case Studies

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