Mineral resource estimate12 Oct 2020 16:22
The company now has 100% ownership of a nickel district, with over 280 million tonnes of resource in the measured and indicated category, in one of the largest mining districts in Brazil - the Carajás district - which has good infrastructure, water, energy and skilled labour."
Martin said that generated the potential for Horizonte to develop two mining centres within trucking distance of each other - the first in the south at Araguaia, where it was developing a ferronickel operation to produce around 14,500 tonnes of nickel with the first stage plant, expandable to 29,000 tonnes of nickel per year.
The second production centre in the north, at the Vermelho nickel cobalt project, had the capacity to produce 15,000 to 18,000 tonnes per year of nickel and associated cobalt.
"Now we have additional high-grade material from the Serra do Tapa deposit which could serve either operation.
"Work on Araguaia is focussed around advancing the project finance and the recruitment and selection of the project development team as we move towards construction.
"The pre-feasibility study on the Vermelho nickel-cobalt project is at an advanced stage and is currently being finalised."
The company aimed to announce the pre-feasibility study to the market later in the current quarter, Martin said, in a bid to provide investors with exposure to the fast-growing electric vehicle battery metals market.
"We have seen increases in the nickel price over the last month with LME nickel trading at highs of around $16,000.
"The base case and the second stage expansion case for the Araguaia Feasibility Study use $14,000 nickel; however, based on the recent nickel price of $16,000, the project net present value on the second stage expansion case is approximately $1bn with an internal rate of return of 30%, generating free cash flow of $3.5bn.
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