Setting New Standards: Nandan Nanfang's Landmark SLL for Zinc Production

Nanfang Non-Ferrous Group is a leading private enterprise in China, specializing in the mining and smelting of non-ferrous metals, including zinc, lead, copper, antimony, and tin. Among its various operations, Nandan Nanfang Non-Ferrous Metals Co., Ltd emerges as one of the largest privately-owned zinc smelters in the country. ​

Considering the energy-intensive nature of traditional zinc production and the associated greenhouse gas emissions, it is essential to recognize the vital role that zinc plays in the energy transition—particularly in protecting essential infrastructure like wind turbines from corrosion and significantly extending their lifespan. Nanfang Non-Ferrous Group is committed to improving the sustainability of its operations. By tapping into the sustainable finance market , the company can effectively drive for environmental improvements.​

Natixis is pleased to have acted as the sole MLAB, Sustainability Coordinator, Facility Agent, and SACE Agent for Nandan Nanfang's JPY 23.6 billion Sustainability-Linked and Structured Pre-Export Financing Term Loan Facility. This landmark transaction represents the first syndicated sustainability-linked loan for Nandan Nanfang and marks a significant milestone as the first for a zinc producer in Asia, setting a new benchmark for responsible zinc production.​

The loan is designed around key performance indicators that focus on three material topics for the issuer:​

• Reducing energy intensity - Improving overall operational efficiency​
• Increasing renewable energy usage - Transitioning to low-carbon energy sources, leveraging the region's hydropower resources​
• GHG emission reduction - Ensuring accountability for environmental impact and progress towards a more sustainable future​

This transaction exemplifies Natixis' commitment to supporting sustainable practices across key sectors and reflects an emerging trend towards responsible financing within the industry. Following the decarbonization trajectory, Nandan Nanfang is dedicated to the transitioning to low-carbon zinc production while exploring new opportunities for low-carbon zinc exports. This advancement highlights a growing interest in low-carbon zinc, and aligns with with the anticipated expansion of Carbon Border Adjustment Mechanism (CBAM) coverage in Europe.​