London-listed Pensana has received the first tranche of $15-million from Cascade Natural Resources, as contemplated under a $165-million strategic investment announced on March 4.

In return for the initial $15-million investment into Pensana, Cascade will receive 13.99-million shares – representing a 3.8% interest in Pensana.

Cascade will also invest $150-million into Pensana’s wholly owned subsidiary Sable Min Unipessoal, which is a majority shareholder in Ozango Minerais, the developer of the Longonjo rare earth mine, in Angola, for a 38.2% interest in Sable.

“We very much welcome the investment by Cascade, which will enable us to continue the development of the Longonjo mine, add the heavy rare earth circuit and expand the resource base to a target of one billion tonnes making it one of the largest rare earth mines ever developed,” says Pensana chairperson Paul Atherley.

He notes that a recent report by the International Energy Agency has highlighted the need to build a robust and resilient international rare earth supply chain to reduce the world's reliance on China to avoid $6.5-trillion of potential economic cost of supply disruption.

“With construction well underway and first production scheduled for 2027 our investment in Longonjo and our plans to establish a fully integrated US mine-to-magnet supply chain will be an important step in securing this supply,” he says.

Alongside the proposed $160-million Absa debt funding package, Pensana says the strategic investment will provide for the construction of the Longonjo mine, including execution of the recently announced drill programme to increase the resource to a target of one-billion tonnes.

The strategic investment will also provide for the construction of the heavy rare earth element (HREE) recovery facility ahead of Longonjo's first production scheduled for 2027, as well as downstream development initiatives, the costs associated with the proposed Nasdaq listing and all corporate costs.

ABG Sundal Collier, an independent Nordic investment bank, has acted as Pensana's financial adviser for the strategic investment.