Noble Capital Markets has maintained its ‘Outperform’ rating on First Phosphate Corp. (CSE:PHOS, OTCQX:FRSPF, FRA:KD0, OTC:FPHOY) following the company’s latest financing update, with the analysts describing the move as another major milestone for the company.
Earlier this week, First Phosphate announced it has secured a non-binding letter of interest (LOI) from the Export and Investment Fund of Denmark (EIFO) for up to €170 million.
The proposed support would help finance the purchase of equipment and services for First Phosphate’s Begin-Lamarche igneous phosphate project in Quebec.
EIFO, a Danish government-backed export credit agency, would provide guarantees to participating banks on a pro rata and pari passu basis with other senior lenders, subject to internal credit approvals and completion of due diligence.
The company is also advancing discussions with the Export-Import Bank of the United States (EXIM), which previously issued an LOI for up to US$170 million to support U.S.-sourced goods and services. That LOI has been extended and is in the process of being extended further.
In addition, Natural Resources Canada has committed up to C$16.7 million in non-repayable funding.
The Noble analysts noted that the EIFO LOI adds another potential source of export-backed financing and complements the existing EXIM support.
“The letters of interest are important because they would allow First Phosphate to source mining equipment and services from both Europe and the United States,” they wrote.
“Coupled with an agreement with Natural Resources Canada to provide up to C$16.7 million in non-repayable government funding, First Phosphate’s engagement with EIFO and EXIM significantly de-risks the path from exploration to feasibility and development.”