PERTH-based uranium company Paladin Energy has sold a minority stake in itsNamibian project Langer Heinrich to refinance the project’s finance facility.

In a deal worth US$190 million, Paladin sold a 25 per cent joint venture equity stake in the project for US$190 million to state-owned China National Nuclear Corporation (CNNC) subsidiary CNNC Overseas Uranium Holding.

Paladin refinanced the existing US$110 million project finance facility and US$20 million working capital facility into a new US$70 million syndicated loan facility.

It was also able to make a US$30.38 million prepayment on the existing facility due to the sale, bringing the balance to US$70 million.

Paladin chief executive John Borshoff said the new facility would provide significant cash flow benefits and further strengthen Paladin’s financial position.

The annual principal repayments within the new financing agreement are expected to reduce by US$32.4 million across the first 3.5 years of the facility – from US$18.33 million per annum to US$9.09 million per annum.

The first repayment of US$4.55 million is not due until December 2014. “Once again, Paladin has been able to refinance the facility in a tough uranium price environment whilst significantly reducing the security requirements and medium term principal repayments,” Mr Borshoff said.

“Paladin continues to focus on ways to reduce the company’s overall debt levels and this represents another step in this process. The agreement includes an offtake component which would allow CNNC to purchase its pro-rata share of product from Langer Heinrich at the prevailing market spot price. The Langer Heinrich deposit, 80km east of the major seaport of Walvis Bay in western Africa, was discovered in the 1970s and was acquired by Paladin in 2002.

The project is producing at a rate of 5.7 million pounds per annum of uranium.