REG - Horizonte Minerals - Update on Araguaia Nickel Project Construction

Horizonte MineralsAnnouncement

02/10/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231002:nRSB2643Oa&default-theme=true

RNS Number : 2643O  Horizonte Minerals PLC  02 October 2023

NEWS
RELEASE

2 October 2023

 

HORIZONTE MINERALS PROVIDES UPDATE ON ITS ARAGUAIA NICKEL

PROJECT CONSTRUCTION

 

Horizonte Minerals Plc (AIM/TSX: HZM) ("Horizonte" or the "Company"), the
nickel company developing two Tier 1 assets in Brazil, announces today that it
has made good progress in completing the final detailed engineering and
construction design for Line 1 of its 100%-owned Araguaia Nickel Project
("Araguaia" or "the Project"). This work, along with a comprehensive cost
review, has resulted in changes to the design and execution scope, which are
expected to increase the overall capital expenditure requirement by at least
35% (of current capex budget) and delay first production to Q3-2024.

 

Given the progress made to date with construction, the value of the Araguaia
Line 1 Project and the upcoming delivery of the Feasibility Study on Araguaia
Line 2, the Company continues to have strong support from its major
partners.  The Company is working on a plan with its various financial
institutions together with the cornerstone shareholders for a financing
solution to complete construction.

 

Construction work on site continues to progress well with all key engineering
drawings issued for construction. Ore stockpiling activities commenced last
quarter, and ROM build-up is progressing to schedule. The rotary dryer is now
in place, with all shells aligned for final welding. Construction of the
126km, 230kV transmission line is well advanced, with all pylons erected and
118km of conductor cable installed. Construction of the water storage
reservoir is also well advanced, with the initial sections of the water
abstraction pipeline positioned and foundations poured for the river
abstraction pump station.

 

To de-risk the operation, the final detailed engineering work has added
additional scope items linked to the major equipment packages, made several
enhanced design changes from the original engineering study (including changes
to the water abstraction pipeline design and water storage reservoir), and has
identified the requirement for additional civil works and quantities.
Additionally, changes have been required with selected suppliers who have not
been able to deliver to the project timeframe, which has added further cost
pressures.

 

Accordingly, the Company engaged Reta Engenharia to undertake an independent
review of the remaining capital expenditure and schedule, incorporating the
change in scope, material and quantity variations, increased project duration
to first metal and associated costs, and additional working capital
requirements. The Company has also undertaken a detailed review of the ramp up
and operational costs. The Company expects to publish an update by mid Q4-2023
once this review is complete.

 

The results from the Feasibility Study on Araguaia Line 2 remain on track to
be published in Q4-2023. The combined production of Araguaia Line 1 and 2 is
expected to be 29,000 tonnes per annum.

 

Jeremy Martin, CEO of Horizonte, commented:

"We continue to make solid progress with construction at Araguaia Line 1 and
are confident that the Project is now significantly de-risked given the
near-finalization of detailed engineering and procurement, together with the
detailed review of the costs to project completion, ensuring successful
delivery. Despite the anticipated higher capital requirement, Araguaia remains
a Tier 1 asset that will deliver strong margins over its 28-year mine life
once production commences next year. Moreover, the imminent completion of the
Feasibility Study on Line 2 will demonstrate Araguaia's capacity to support an
annual production of 29,000 tonnes per annum.

 

We appreciate the strong support provided by both local stakeholders and
cornerstone shareholders, as we work towards a financing solution to complete
construction."

 

Further updates will be provided in due course. This announcement contains
inside information for the purposes of Article 7 of EU Regulation 596/2014, as
retained in the UK pursuant to the European Union (Withdrawal) Act 2018.

 

For further information, visit www.horizonteminerals.com
(http://www.horizonteminerals.com) or contact:

 

 Horizonte Minerals plc                                                     info@horizonteminerals.com (mailto:info@horizonteminerals.com)

 Jeremy Martin (CEO)                                                        +44 (0) 203 356 2901

 Simon Retter (CFO)

 Patrick Chambers (Head of IR)

 Peel Hunt LLP (Nominated Adviser & Joint Broker)                           +44 (0)20 7418 8900

 Ross Allister

 Bhavesh Patel

 BMO (Joint Broker)                                                         +44 (0) 20 7236 1010

 Thomas Rider

 Pascal Lussier Duquette

 Andrew Cameron

 Barclays (Joint Broker)                                                    +44 (0)20 7623 2323

 Philip Lindop

 Richard Bassingthwaighte

 Tavistock (Financial PR)                                                   +44 (0) 20 7920 3150

 Jos Simson

 Cath Drummond

 

 

 

 

ABOUT HORIZONTE MINERALS

Horizonte Minerals Plc (AIM/TSX: HZM) is developing two 100%-owned, Tier 1
projects in Pará state, Brazil - the Araguaia Nickel Project and the Vermelho
Nickel-Cobalt Project. Both projects are high-grade, low-cost, with low carbon
emission intensities and are scalable. Araguaia is under construction and when
fully ramped up with Line 1 and Line 2, is forecast to produce 29,000 tonnes
of nickel per year. Vermelho is at feasibility study stage and is expected to
produce 24,000 tonnes of nickel and 1,250 tonnes of cobalt to supply the EV
battery market. Horizonte's combined production profile of over 60,000 tonnes
of nickel per year positions the Company as a globally significant nickel
producer. Horizonte's top three shareholders are La Mancha Investments S.à
r.l., Glencore Plc and Orion Resource Partners LLP.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCFLFLTIDLLIIV