(Alliance News) - Horizonte Minerals PLC on Friday said it has made "significant" progress with the key workstreams needed to begin construction on its Araguaia nickel project in Brazil despite the challenges posed by the Covid-19 pandemic over the last 10 months.
Regarding the project funding package for Araguaia, the UK-based nickel development company has continued to engage with prospective investors. Horizonte said it has recently negotiated a non-binding term sheet with a cornerstone equity investor and reached an advanced stage with offtake agreements.
It also received initial approval for a financing facility of up to BRL200 million, or USD32 million, from Banco da Amazonia and is now advancing workstreams with a syndicate of five international banks for the principal project finance package.
Additionally, Horizonte has over the past eight months undertaken a phase of value engineering to upgrade the feasibility study that was completed in 2018 to optimise the project to be ready for implementation. The company said that this included development of a detailed project execution and operational readiness plan.
Chief Executive Jeremy Martin said: "These workstreams have further de-risked the project and give us clear visibility on how we will deliver a successful, tier-one nickel project. The high calibre of the individuals we have been able to attract is testament to the quality of our projects, the growth trajectory of the company, and the culture of best practice that we have worked hard to develop over many years of operating in Brazil."
Due to the impact of ongoing Covid-19 related lockdowns on financial markets, Horizonte said it now anticipates completing the full project financing package in the first half of 2021, with construction commencing shortly afterwards.
Shares in Horizonte Minerals were down 6.5% at 6.50 pence in London on Friday.
By Zoe Wickens; zoewickens@alliancenews.com
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Horizonte Minerals (HZM)