Junior miner First Phosphate Corp., Saguenay, Quebec, on Sept. 29 announced that it has received a Letter of Interest (LOI) from the US Export-Import Bank (EXIM), where EXIM expresses that it would be able to provide financing in the amount of up to $170 million. The LOI is in support of the procurement of US goods and services by First Phosphate in Canada and is eligible for a maximum repayment term of 10 years. The LOI expires Oct. 14, 2024.
In addition, the company said the transaction may be eligible for special consideration under Section 402 of EXIM’s 2019 reauthorization (PL 116-94), which directs EXIM to take steps to mitigate the competitive impact of export support provided by the People’s Republic of China and other covered countries for opportunities such as this one and/or to advance the comparative leadership of the US in the Transformational Export Areas under EXIM’s China and Transformational Exports Program (CTEP).
“First Phosphate is committed to creating a strategic purified phosphoric acid (PPA) reserve to service the development of the lithium iron phosphate (LFP) battery industry in North America,” said CEO John Passalacqua. “We thank EXIM bank and US policy makers for working to build a strong North American LFP battery supply chain.”
“We are honored by the receipt of the LOI and look forward to committing to purchasing our capital equipment and services in America through support from EXIM,” Passalacqua continued. “Access to this stable, government-backed financing allows us to build out our projects judiciously while limiting the amount of equity dilution to our shareholders.”
First Phosphate said the LOI does not represent a financing commitment and does not guarantee the company’s access to any or all financing from EXIM. EXIM is to conduct its standard due diligence prior to issuing a final commitment for this transaction.
First Phosphate holds 1,500 square kilometers of total land claims in the Saguenay Region, some 110 kilometers north of the City of Saguenay, which it is actively developing to produce battery grade phosphate and with a low-carbon footprint (GM Oct. 14, 2022).
EXIM is the official export credit agency of the US. It is an independent executive branch agency with a mission of supporting American jobs by facilitating the export of US goods and services.