Horizonte Minerals (TSX: HZM; AIM: HZM) stated building prices for its Araguaia nickel mine in northern Brazil have elevated by 12.6% to US$537 million, up from the earlier US$477 million estimate, due largely to inflationary strain.
Horizonte began constructing the Araguaia nickel mine, which it acquired from Glencore in 2015, in Might and stays on schedule.
“The corporate has additionally opted to put money into further EPCM [engineering, procurement and construction management] and homeowners crew assets to additional de-risk the venture schedule and search to make sure supply of first nickel in 1Q24, in step with the unique plan,” it stated within the operational replace.
Horizonte famous that larger rates of interest throughout the globe, as central banks search to regulate inflation, additionally influenced its capex plans.
The corporate, which as soon as thought of the nickel venture to be fully-funded, raised £70.5 million (US$80 million) this week by means of an fairness fundraise.
“Following important institutional demand within the bookbuild from current and new traders, the board determined to upsize the lacing, rising the gross proceeds from roughly £61.7 million to £70.5 million,” the corporate stated.
Building of the Araguaia nickel mine, which might take about two years, contains an open pit and a processing plant, which can produce ferronickel over an estimated 28-year interval.
The operation in Brazil’s Pará state is predicted to initially generate 14,500 tonnes of nickel a yr, largely destined to produce the stainless-steel market. Output is predicted to leap as much as 29,000 tonnes of the battery steel a yr after a second manufacturing line comes on-line in 2027.
Araguaia is taken into account a key venture to diversify the nation’s mining sector, which is centred on iron ore.