Highlights
- Pensana Plc launches US$11M drilling program at Longonjo, Angola to expand resource estimate from 313Mt to over 1 billion tonnes TREO, potentially ranking among the world's largest deposits.
- The company's £280-300M market cap reflects a 250%+ share price gain, but it remains pre-revenue with auditor going concern flags and reliance on US$160M EXIM debt funding.
- Longonjo project is tied to Lobito Corridor infrastructure and U.S. magnet supply chain via eVAC Magnetics partnership, though country risk and policy timing questions persist.
Pensana Plc (opens in a new tab) (LSE: PRE) has announced a US$11 million drilling and metallurgical program at its Longonjo rare earth project in Angola, aiming to lift the JORC Mineral Resource Estimate from 313 Mt at 1.43% TREO to “over one billion tonnes” at similar grade – a scale that would place Longonjo among the world’s largest rare earth deposits by tonnage, if realized.
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The program includes 25,000 m of vertical core drilling plus metallurgical testwork for mine planning and processing optimization, with work slated to start early in the new year and results released as they become available.
Big Tonnage, Bigger Questions
On the geology, Pensana’s messaging is broadly consistent with earlier technical disclosures: Longonjo is a weathered carbonatite hosting a shallow, high-grade TREO blanket (~20–30 m thick) with known depth extensions and significant NdPr content.
However, investors must separate resource theory from economic reality:
- The current ore reserves (21.5 Mt at 3.04% TREO) underpin a 20+ year mine life; the billion-tonne target refers to resources, not reserves or proven economics. More work is needed to validate.
- The press release leans heavily on scale and “world-class” language but offers no updated capex, opex, or cut-off assumptions.
- A US$11m spend is modest relative to the step change implied; REEx views this as incremental de-risking, not yet a structural re-rating event.
The Longonjo story is now explicitly tied to the Lobito Corridor infrastructure build-out and a mine-to-magnet chain into the U.S., via Pensana’s partnership with Vacuumschmelze’s eVAC Magnetics facility in Sumter, South Carolina (opens in a new tab), initially targeting 2,000 tpa of magnets, rising to 12,000 tpa by 2029. As REEx continues to chronicle, Pensana will plug into the U.S. markets with significant business development presence downstream.
Critical open questions for investors: Can funding, construction, and logistics all align in time to meaningfully support U.S. rare earth independence? How will Pensana balance Angola country risk, Lobito execution, and U.S. policy timelines? These are fair questions.
Stock Lens: Momentum Meets Financing Reality
Pensana’s market cap now sits around £280–300 million (≈US$375m) after a >250% 12-month share price gain, with PRE trading in a volatile 16p–184p range. The company remains pre-revenue, reliant on equity and prospective U.S. EXIM debt funding (~US$160m) to build out Longonjo and the downstream chain.
REEx also notes auditor “going concern” flags earlier in 2025 – a reminder that project execution and financing are not yet fait accompli. For investors, the drill program is positive but should be read as another step in a high-risk, high-reward build, not proof that the billion-tonne prize is already banked.
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Question is: Pensana dont appear to have $11 million in free cash to spend on a drilling program, especially on a resource that alrerady has. 20 year mine life at full production (with 4500 Mts p.a of ndpr oxide per annum and 137,000 Mts of JORC assessed reserves it is nearer 30 years). All their financing is committed to the mine development. As the drilling program is due to start early in the new year, is it going too far speculate that Pensana are accessing some new funding soon, of which an extended mine life of 100 years or more would be strategically advantageous to the the new investor