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Kibaran Resources Limited: German Bank in 2nd move over Financing of US$77m Tanzanian Graphite Mine for Australia's Kibaran

DGAP-News: Kibaran Resources Limited / Key word(s): Financing
Kibaran Resources Limited: German Bank in 2nd move over Financing of
US$77m Tanzanian Graphite Mine for Australia's Kibaran

07.10.2015 / 12:00

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German Bank in 2nd move over Financing of US$77m Tanzanian Graphite Mine
for Australia's Kibaran

German bank KfW IPEX-Bank has signed a formal mandate letter with
Australia's Kibaran Resources Limited (ASX:KNL) ('Kibaran' or the
'Company') to explore financing options to fund the construction of the
Company's proposed US$77 million Epanko graphite mine in Tanzania.

Kibaran is pleased to report the signing of the mandate letter with
Germany's KfW IPEX-Bank under which the Bank will provide advice and
structuring support in relation to previously announced UFK cover and,
subject to due diligence, consider an initial senior loan of up to US$40
million towards Epanko's capex.

This is the second move by KfW IPEX-Bank in support of Kibaran's Epanko
graphite mine development plans and follows the announcement last month
that the project had secured the "in-principle eligibility for cover" of
the Untied Loan Guarantee Scheme ("UFK") of the Federal Republic of
Germany.

Kibaran Managing Director, Mr Andrew Spinks:

"The mandate is a further step forward for Epanko and formally confirms KfW
IPEX-Bank's interest in participating in financing for the project after it
received confirmation of the 'in-principle eligibility for cover' under the
UFK Scheme early in September.

"We do not wish to pre-empt the Bank's current due diligence assessment
over, if and how this project can be financed through to completion of mine
construction. We are heartened, however, by the sentiments expressed by the
Bank to Kibaran over recent weeks leading up to this agreement's signing.

"Our current discussions include KfW IPEX-Bank also assisting in arranging
further debt financing arrangements to progress completion of Epanko mine
development.

"KfW is one of the world's leading promotional banks and its subsidiary
bank, KfW IPEX-Bank with whom we are negotiating, has a strong track record
in the mining sector, including in Africa. This parallels Kibaran's drive
to establish our three Tanzanian graphite projects as an East African
graphite 'hub' best positioned to service growing European market demand."

Kibaran earlier this month received confirmation of the in-principle
eligibility for cover under the UFK Scheme. The confirmation is based on
ThyssenKrupp and an European trader supplying the German industry with
approximately half of their graphite offtake totalling 30,000 tpa. The UFK
cover is subject to further due diligence and final approval by the German
Government.

It is Kibaran's strategy to achieve an UFK Guarantee to support the debt
component of funding development of Epanko.

Kibaran recently released an updated production growth strategy which
confirmed that it's Epanko and Merelani-Arusha graphite projects in
Tanzania have the potential to produce a combined 150,000tpa of graphite
concentrate by the 6th year of mining and processing operations - a 50%
increase over initial estimates this year of a headline rate of 100,00tpa.

BACKGROUND ON THE UFK SCHEME

The German Federal Government provides UFK coverage in form of loan
guarantees for the financing of eligible projects. An Untied Loan Guarantee
insures project's lenders against losses incurred due to commercial and
political risks.

Eligible projects contribute to the supply of critical natural resources to
Germany in form of long-term off-take contracts between the borrower and
German off-takers. The project has to be economically viable and comply
with international environmental and social standards (e.g. Equator
Principles).

More information on the UFK Scheme is available under http://www
.agaportal.de/en/ufk/index.html

Further information, please contact:

Managing Director
Andrew Spinks

CFO/Company Secretary
Robert Hodby


Kibaran Resources Limited | ABN: 15 117 330 757
338 Hay Street Subiaco WA 6008 | PO Box 2106 Subiaco WA 6904
T: [phone] | E: [e-mail] |
www.kibaranresources.com



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400559 07.10.2015