(Alliance News) - Anglo Pacific Group PLC has made its first foray into the industrial minerals market, it announced on Monday.
Anglo Pacific, a mining royalty investor, is committing USD20 million to a financing agreement secured by Incoa Performance Minerals LLC. In return, it will get a 1.23% gross revenue royalty once the mine starts producing.
Incoa is currently developing a calcium carbonate mine in the Dominican Republic as well as an associated processing facility in Mobile, Alabama. Incoa will produce calcium carbonate for the US market, Anglo Pacific said.
Calcium carbonate is used as a filler agent in a variety of products, such as rubber, adhesives, sealants, and caulks, as well as in the food and pharmaceutical industries.
Anglo Pacific's USD20 million investment will help Incoa bring its product to the market. The investment is conditional on Incoa completing construction and bringing the project into production.
Anglo Pacific Chief Executive Julian Treger commented: "We are delighted to announce the opportunity to invest USD20 million into the Incoa calcium carbonate project, allowing us to expand our portfolio further to include industrial minerals. The transaction is structured such that funds are only invested when the operation is in production and generating cash flow.
"The Incoa project meets many of the group's investment criteria, especially in relation to environmental, social, & governance, product quality, long mine life, attractive cost profile and, by the time the funds are invested, the project will be generating cash flow. This will further diversify our portfolio and will continue our trajectory of reduced exposure to coal."
Last week, Anglo Pacific said it will be making no future investments into thermal coal, which is used to power coal-fired power stations.
Shares were 5.4% higher on Monday morning in London at a price of 136.50 pence each.
By George Collard; georgecollard@alliancenews.com
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