Millennial Potash Corp (TSX-V:MLP, OTCQB:MLPNF) said on Wednesday that the US International Development Finance Corporation (DFC) has committed up to $3 million in development funding for its Banio Potash Project in Gabon, supporting a feasibility study aimed at advancing the fertilizer resource toward production.
The strategic investment, announced at a joint signing ceremony in Washington DC on July 8 attended by Gabonese President Brice Oligui Nguema, will be delivered through the DFC’s Project Development Program.
The funds will be released in phases as Millennial completes key milestones within the feasibility study, the company said.
“The DFC project development funding demonstrates the increasing strategic importance of Millennial's Banio Potash Project not only for Africa but for other key potash consuming markets in the world,” Millennial chair Farhad Abasov said in a statement.
Abasov added that the DFC investment comes as the company nears completion of its second drill phase and transitions from exploration to development. He noted the involvement of the US Ambassador to Gabon and strong support from the Gabonese government, adding that the investment de-risks the project and lays the groundwork for future financing.
DFC, the US government’s development finance institution, aims to mobilize private sector investment in strategic sectors, including agriculture.
“DFC is excited to collaborate with Millennial Potash on this groundbreaking initiative, which will help accelerate food production across the African continent,” said Conor Coleman, head of investments at DFC, in a statement.
The Banio project, located in southwestern Gabon, is expected to support regional food security by increasing access to domestically produced potash, a critical fertilizer component. The company has already initiated early feasibility work, including LiDAR and bathymetry surveys, geotechnical testing, and dissolution studies on recent drill core samples.
DFC’s funding is non-dilutive, carries no interest, and is repayable only upon the project reaching a financing or construction investment decision. No security interest was granted under the agreement.
Investors cheered the update, sending shares of Millennial Potash more than 13% higher to C$1.62 in early trade on Wednesday.