A Promising Venture in the World of Nickel
Horizonte Minerals, a mineral exploration and development company, is currently in talks to secure additional funding for its Araguaia nickel project. Despite a slight overrun in construction costs, the project remains a strong investment opportunity in the nickel market.
Chief Executive Officer Jeremy Martin expressed confidence in the project’s progress. Construction is proceeding according to plan, with significant milestones achieved, including the installation of rotary kiln sections and the completion of the furnace shell and roof installation. The company has also stockpiled 138,000 tonnes of ore, averaging 1.92% nickel, indicating promising prospects for future production.
Financial Overview and Liquidity
As of 30 September, Horizonte had invested a total of $429 million in the Araguaia project. The majority of this capital, $346 million, was drawn from the senior secured project finance debt facility. The company currently boasts total liquidity of $253 million, with $131 million yet to be drawn from the debt facility and cash reserves amounting to $122 million.
Outlook for the Araguaia Project
The Araguaia project is expected to produce approximately 29,000 tonnes of nickel per year. The majority of this output will be directed toward the thriving stainless steel market. Horizonte Minerals anticipates that the project, which encompasses an open pit and a processing plant, will yield favorable results due to its long mine life, low impurity levels, and Tier 1 nickel classification. The project is geared toward achieving low-quartile C1 cash costs, making it an attractive venture in the nickel industry.
Funding for Overrun and Project Evaluation
To address the slight overrun in construction costs, Horizonte Minerals is engaging in funding talks to ensure the project’s smooth progression. Reta Engenharia has been retained as the detailed capital cost and schedule analysis provider, and their evaluation is set to be completed by the midpoint of the fourth quarter this year. Following that, an independent technical advisor, nominated by senior lenders, will review the updated costs to provide further validation and support.
Investing in the Future of Nickel
Horizonte Minerals’ Araguaia project promises a bright future in the world of nickel production. Despite the current funding talks and project overrun, the venture offers investors the opportunity to capitalize on a Tier 1 nickel project with a low mine life cost and high-grade, low-impurity iron/nickel production. As the stainless steel market continues to grow, this project is well-positioned to meet the increasing demand for nickel.
