Interview with Paul Atherley, Chairman of Pensana PLC

Our previous interview: https://www.cruxinvestor.com/posts/pensana-pre-confident-funding-is-imminent-2582

Recording date: 28th March 2025

Pensana PLC, chaired by Paul Atherley, has secured financing to begin construction on one of the world's largest undeveloped rare earth projects in Angola. The project will process 20,000 tons initially, eventually scaling to 40,000 tons, placing it in the same league as industry leaders Lynas and MP Materials.

The financing package comes from three key institutions: Angola's sovereign wealth fund (FSDA), Absa Bank from South Africa, and the African Finance Corporation. The structure consists of approximately 60% debt and 40% equity spread across these institutions. The equity component is expected to be drawn down within weeks, while the debt documentation will take 6-9 months to finalize.

What distinguishes Pensana's approach is its focus on creating a non-Chinese rare earth supply chain. Rather than simply mining and exporting raw materials to China, the company plans to produce a mixed rare earth carbonate (MRE), a midstream product that can be processed further outside China. The company is in discussions with potential partners who have separation capacity outside China, which Atherley describes as "a very important step" in creating an independent global supply chain.

The Longonjo project contains over 100,000 tons of valuable neodymium and praseodymium in its top 30 meters, with an exceptionally low strip ratio of 0.2:1, indicating efficient mining potential. Technical validation has been completed through extensive testing at laboratories in Western Australia, confirming the quality of their product.

Construction is now beginning, with first production targeted for the end of 2026, followed by a six-month ramp-up period to reach full production in 2027. The financing will dilute Pensana's ownership from 84% to 70% initially, with potential further dilution to 52% if certain mezzanine financing is not refinanced.

Atherley sees significant growth potential as the company is "building a project at the bottom of the rare earth price cycle," contrasting their current $100 million market cap with Lynas at $4 billion. He highlights future demand drivers including electric vehicles, wind turbines, and emerging technologies like humanoid robotics.

As Atherley notes, "It's an electric future based on electromagnetics and we will be a producer going into that rising thematic."

View Pensana's company profile: https://www.cruxinvestor.com/companies/pensana-plc

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