Jeremy Martin builds momentum at Horizonte Minerals

Thursday, Aug 25 2011 by
7
Jeremy Martin builds momentum at Horizonte Minerals

Twelve months ago Jeremy Martin, the chief executive of nickel and gold exploration group Horizonte Minerals (LON:HZM), oversaw a major tie-up with industry giant Teck Resources (TSX:TCK) that promised to transform the AIM listed company. The move involved Teck handing over control of its Araguaia nickel project in the Carajas mineral district of northern Brazil in return for a 50% stake in Horizonte. Since then, Horizonte has merged Araguaia with its own Lontra nickel project and met every milestone in its plans to establish a 100 million ton resource at the site. In turn, drilling is now under way on the company’s Falcao gold project, where it is working in partnership with another mining giant, AngloGold Ashanti (NYSE:AU). In addition to a series of resource updates, the company has found time to complete a substantial fundraising, expand its licence holding and complete a listing on the Toronto Stock Exchange.

Jeremy, the last 12 months have seen some significant changes at Horizonte Minerals, particularly at your Araguaia nickel project in Brazil. What have been the important milestones?

Well, going back to last year, we closed the deal in August with Teck and in October we started the main resource drilling programme. We have got six drill rigs active on the project at the moment, so it is a big drill programme down there. In January we signed a royalty agreement with Anglo Pacific, which was another milestone in the project, and that is where they can effectively acquire a 1.5% net smelter royalty (NSR) for $12.5 million, so that’s good downstream funding potential. We then raised £8.3 million in February, which allowed us to really ramp up everything across the board down in Brazil. In March we released our maiden resource of 76 million tons at 1.35% nickel, which was ahead of expectations in terms of size and grade. We have just got our TSX listing and in July we completed the final acquisition of three additional target areas, one with some resources on, from TSX-listed Lara Exploration (TSX:LRA).

So we have basically hit all of the milestones on time. The resource upgrade is due out in Q4, and that will be the 100 million tons target, which is all looking good. We have got some high grades coming out of the project, there have been a number of…

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Horizonte Minerals PLC is a United Kingdom-based nickel development company. The Company owns the advanced Araguaia nickel laterite project located to the south of the Carajas mineral district of northern Brazil. The Araguaia project area consists of approximately 20 exploration licenses totaling approximately 110,170 hectares. The Company has completed diamond drilling of approximately 45,420 meters. Its fourth phase program was designed to complete infill drilling on the grids on the Pequizeiro and Jacutinga deposits of the Araguaia nickel project. Its metallurgical test program includes a series of laboratory tests designed to establish the suitability of the ore for rotary kiln processing; smelting testing; work on agglomeration, and testing for rotary kiln operation and smelting conditions, including a range of physical and chemical laboratory tests. It has started an integrated pilot plant-testing program at Morro Azul RKEF pilot plant test work facility in Minas Gerais, Brazil. more »

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9 Comments on this Article show/hide all

Soundbuy 25th Aug '11 1 of 9

Covers much of the same ground but worth a listen too. (Below)

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marben100 25th Aug '11 3 of 9
1

Ben,

There's a significant error in this sentence:


For nickel, we were recently around $24,000 per ton. Its high point, 18 months ago, was nearly $15,000 a ton and then mid financial crisis it went down to $9,000 to $10,000 a ton.

 

The high point was in May 2007, when the price nearly hit $55,000/tonne. See http://www.lme.com/nickel_graphs.asp It currently stands at just over $20,000.

There are some concerns about possible upcoming oversupply in the nickel market. Here's a recent article: http://www.mineweb.com/mineweb/view/mineweb/en/page96985?oid=132680&sn=2010+Detail&pid=102055

DISCLAIMER: I hold Horizonte.

Regards,

Mark

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fourayes 26th Aug '11 4 of 9

In reply to post #59503

Ben,

This is the third major piece on Horizonte in the last year. Are you plugging them, or are they simply a brilliant prospect? You are almost acting as a financial PR for them, then I suppose that is what this site does.

Does any shareholder have a view on this company, I would be interested to learn more?

fourayes

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Ben Hobson 26th Aug '11 5 of 9

Mark, I see where you are coming from. I was trying to get Jeremy to comment on the fact that nickel has (had) been generally trending higher since early 2009 and what that meant in the context of his project. For sure, the supply/demand dynamics that caused the spike between 2006/2007 don't exist in the same way any more. I'll take a closer look at that Q&A.

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Ben Hobson 26th Aug '11 6 of 9
3

Hi fourayes,

Ahem, you have noticed an editorial dilemma. The answer isn't simple but it certainly isn't that I/we are plugging anyone. We do provide additional news coverage to site sponsors but, in that case, we make it clear that they are a sponsor on the company page and below the article, and that isn't the case here.

We don't do PR or "tip" companies as we believe it's up to investors to make their own individual decisions based on the facts and their risk appetite, and the Stockopedia team are very keen to build editorial credibility, particularly in a market where investors have to be careful about the agendas of writers. On the flipside, some companies/individuals are more vocal and keen to speak than others and we like to encourage transparency. There is an ongoing in-house 'conversation' about how, when and if we go back to companies we have already spoken to. I like the idea of following companies (particularly those that have a reasonable following amongst Stockopedia users) but there are risks to that, particularly when there are so many companies out there to talk to (if only they all would!).

As a final point, we'd encourage Stockopedia users to tell us what they want to see (and also to encourage management teams to speak to us, as this is always helpful). Obviously, there is a fast growing base of contributors (where, again, you'll occasionally get overlaps in company coverage and interviews) but I am here to go and speak to companies. If you have got any suggestions, give me a shout.

Ben

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JPGH 29th Aug '11 7 of 9
1

Mark, Ben

I think the Horizonte chap is talking short tons and not metric tonnes here (1000 lb per short ton compared with 1000 kg or 2200lb per metric tonne). I always watch out for that critical spelling. Hence the $20,000 per ton is $44,000 per tonne. Would be best though if they just used prices per pound $/lb then there is no ambiguity.

JPGH

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marben100 30th Aug '11 8 of 9

In reply to post #59612

Don't think so, JPGH.

Have a look at the LME chart. "Recently around $24,000/ton" is consistent with recent values on that chart - but, as you can see, the peak was much higher. Rather, I suspect a transcription error: "$15,000" probably was $50,000 (though that was in 2007, not 18 months ago).

Incidentally, according to this, a short ton is 2,000lb; a ton (imperial, "long ton") = 2,240lb (precisely); a tonne = 1,000kg =~2,204lb. It gets even more confusing when you talk about uranium when 1 tonne Ue (equivalent) ~2,600lb U3O8 and everyone gets confused when one company or source talks about lbs of U3O8e in ore, whereas another talks about tU. :~/

Cheers,

Mark

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JPGH 30th Aug '11 9 of 9

oops, Mark correct SHORT TON = 2000 LBs...a too much sun moment there. An an engineer I am embarassed to say I didn't spot that.
Soem time ago I worked on a project fixated with 1000 lb units (http://en.wikipedia.org/wiki/Kip_(unit)) so maybe thats how I got confused.

Anyway as you say there is something not quite right with regard to Nickel pricing in the Horizonte mans words above.

JPGH

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