Nickel developer Horizonte Minerals (AIM: HZM | TSX: HZM) has kicked off construction and broken ground at its flagship Araguaia Nickel Project in Brazil.
A ground breaking ceremony was held on 18 May 2022. The company said that this key milestone marks the transition of the project from development to construction phase. Araguaia, which is a tier-1 project, has a 24-month construction timeframe with Stage 1 (first line) target production of 14,500tpa of nickel.
Araguaia will be a large high-grade scalable, low-cost producer, with a long mine life and will be a low-carbon source of ferronickel, the company stated.
Jeremy Martin, CEO of Horizonte, said, “We are a step closer to achieving our vision of bringing this project into production and generating first revenues. This all comes at a time where the nickel market is facing constrained supply which will benefit Horizonte as we become a globally significant producer.”
Horizonte Minerals has awarded the majority of the key long-lead equipment contracts, including the award of the furnace, the earthworks contract, the EPCM contract, and has now broken ground.
Contracts awarded
The company said a significant amount of progress has been made in the four months since project approval, focused around early works and site preparation ahead of the main mobilization of the earthwork’s contractor, basic and detailed engineering, and the tender and award of a number of key process equipment packages.
As of end of April 2022, Horizonte Minerals had awarded contracts totalling US$204M with a further U$66M of contracts to be awarded imminently, on budget.
“Our team have made excellent progress on the key aspects of engineering, procurement, and site works. Whilst we are facing inflationary pressures along with all other global projects, to date we have been able to award approximately 50% of our pre-contingency project direct capex on budget, which is a very positive result,” said Mr Martin.
Offsetting inflation
Mr Martin also said that while current global inflation is well documented, Horizonte Minerals has an embedded culture of continuous optimization and business improvement throughout the organization as part of a plan to offset these effects.
This work is designed to allow for early optimization in the engineering process and identification of cost saving initiatives, a critical process in the current macro environment, and which has yielded positive results to date, he said.
To find out more visit www.horizonteminerals.com
