Horizonte Announces US$25 Million Royalty Funding With Orion Mine Finance for the Development of Its Araguaia Project
August 29 2019 - 2:00AM
Horizonte Minerals Plc, (AIM: HZM, TSX: HZM)
(‘Horizonte’ or ‘the Company’) the nickel company focused in
Brazil, which is developing the Araguaia project as Brazil’s next
ferro-nickel mine and advancing the Vermelho nickel cobalt project
for the electric vehicle battery market, is pleased to announce
that it has signed a royalty agreement with Orion Mine Finance
(‘Orion’) to provide funding to advance its Araguaia ferro-nickel
Project (‘Araguaia’ or ‘the Project’).
Highlights:
- Orion will provide an upfront cash
payment of US$25 million in exchange for a 2.25% royalty on the
Araguaia Project.
- The Royalty only applies to the
first 426,429 tonnes of contained nickel within the final product
(ferronickel) produced and sold. This is equivalent to the nickel
production estimated over the life of mine for Araguaia in the
Stage 1 Feasibility Study.
- Orion has a strong track record in
financing successful mining construction projects and has deployed
approximately US$1.5 billion in royalties, streams, debt and equity
over the past 3 years.
Philip Clegg, Portfolio Manager at Orion
Resource Partners said, "Orion is delighted to become a
major investor in Araguaia, one of the leading nickel development
projects globally. We look forward to supporting Horizonte as it
enters the next phase of development of its world-class portfolio
of nickel assets."
Jeremy Martin, Chief Executive of
Horizonte, commented, “We are extremely pleased to secure
this royalty agreement with Orion, which enables us to build out
our owner’s team, advance engineering and early works packages as
we proceed to the start of full construction at Araguaia. This
royalty financing is non-dilutive for shareholders, and has been
pre-designed to be compatible with the project funding
package. Nickel has been an outstanding performer this year,
currently trading almost 50% higher than at the start of 2019. At
current nickel prices of US$15,500/t, the Araguaia Feasibility
Study Stage 1 returns an NPV of more than US$580 million.
Orion is one of the largest mining finance
groups in the marketplace with approximately $5.1 billion under
management. We look forward to working with their team as the
Araguaia project advances through to construction.”
Analyst conference call and
presentationHorizonte will host an analyst conference call
and presentation today, 29 August 2019, at 10:00AM BST.
Participants can access the call by dialling one of the following
numbers below approximately 10 minutes prior to the start of the
call.
UK Toll-Free Number: 08003589473UK Toll Number:
+44 3333000804 Pin: 68052152#
The presentation will be available for download from the
Company’s website www.horizonteminerals.com or by clicking on the
link below:
https://www.anywhereconference.com?Conference=301297991&PIN=68052152&UserAudioMode=DATA
A recording of the conference call will
subsequently be available on the Company’s website
For further information, visit
www.horizonteminerals.com or contact:
Horizonte Minerals plcJeremy
Martin (CEO) +44 (0) 203 356 2901
Numis Securities Ltd (NOMAD & Joint
Broker)John Prior +44 (0) 207 260 1000Paul Gillam
Shard Capital (Joint
Broker)Damon Heath +44 (0) 20 186 9952Erik Woolgar
About Horizonte
Minerals:Horizonte Minerals plc is an AIM and TSX-listed
nickel development company focused in Brazil. The Company is
developing the Araguaia project, as the next major ferronickel mine
in Brazil, and the Vermelho nickel-cobalt project, with the aim of
being able to supply nickel and cobalt to the EV battery market.
Both projects are 100% owned.
About Orion Mine Finance:The
Orion Mine Finance Group is a mining-focused investment business
with USD 5.1 billion under management (as of June 30th, 2019).
Orion specializes in providing comprehensive and customized capital
investment solutions to mining companies.
Endeavour Financial is acting as financial
advisor to the Company and Norton Rose Fulbright LLP has acted as
legal counsel to the Company.
CAUTIONARY STATEMENT REGARDING FORWARD
LOOKING INFORMATION
Except for statements of historical fact
relating to the Company, certain information contained in this
press release constitutes "forward-looking information" under
Canadian securities legislation. Forward-looking information
includes, but is not limited to, the ability of the Company to
complete the Acquisition as described herein, statements with
respect to the potential of the Company's current or future
property mineral projects; the success of exploration and mining
activities; cost and timing of future exploration, production and
development; the estimation of mineral resources and reserves and
the ability of the Company to achieve its goals in respect of
growing its mineral resources; the ability of the Company to
complete the Placing as described herein, and the realization of
mineral resource and reserve estimates. Generally, forward-looking
information can be identified by the use of forward-looking
terminology such as "plans", "expects" or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes",
or variations of such words and phrases or statements that certain
actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved". Forward-looking
information is based on the reasonable assumptions, estimates,
analysis and opinions of management made in light of its experience
and its perception of trends, current conditions and expected
developments, as well as other factors that management believes to
be relevant and reasonable in the circumstances at the date that
such statements are made, and are inherently subject to known and
unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements of
the Company to be materially different from those expressed or
implied by such forward-looking information, including but not
limited to risks related to: the inability of the Company to
complete the Acquisition as described herein, exploration and
mining risks, competition from competitors with greater capital;
the Company's lack of experience with respect to development-stage
mining operations; fluctuations in metal prices; uninsured risks;
environmental and other regulatory requirements; exploration,
mining and other licences; the Company's future payment
obligations; potential disputes with respect to the Company's title
to, and the area of, its mining concessions; the Company's
dependence on its ability to obtain sufficient financing in the
future; the Company's dependence on its relationships with third
parties; the Company's joint ventures; the potential of currency
fluctuations and political or economic instability in countries in
which the Company operates; currency exchange fluctuations; the
Company's ability to manage its growth effectively; the trading
market for the ordinary shares of the Company; uncertainty with
respect to the Company's plans to continue to develop its
operations and new projects; the Company's dependence on key
personnel; possible conflicts of interest of directors and officers
of the Company, the inability of the Company to complete the
Placing on the terms as described herein, and various risks
associated with the legal and regulatory framework within which the
Company operates. Although management of the Company has attempted
to identify important factors that could cause actual results to
differ materially from those contained in forward-looking
information, there may be other factors that cause results not to
be as anticipated, estimated or intended. There can be no assurance
that such statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements.
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