Strandline will soon be cashed-up and ready to develop its Tanzanian mineral sands project after tapping an international investment bank as lead arranger and underwriter for a $US26 ($37.6) million loan.

The Strandline (ASX:STA) share price rocketed almost 20 per cent to an intraday price of 10.5c, paring some of the losses it had suffered over the last few months.

A lead arranger heads a group of investors in a syndicated loan for major project financing, and usually takes on the largest part of the loan.

Strandline told investors that it had signed the non-binding, five year financing agreement with African bank Nedbank CIB, “a major investment bank with extensive experience in mining project financing in mineral sands developments on the African continent”.

This facility covers most of theUS$32 ($46.3) million development costs for Strandline’s Fungoni project.

The Strandline share price over the past 12 months.
The Strandline share price over the past 12 months.

An updated feasibility study on Fungoni released in November last year predicted $260m in revenue over the life of the mine, driven by an increasingly bullish market outlook.

Nedbank has already kicked off its due diligence reviews into the project – which should be finished by the end of the March quarter — with financing agreements scheduled to follow as “soon as practicable” this year.

Strandline already has its key mining and environment licences in place and 100 per cent of its product pre-sold via offtake.