TORONTO (miningweekly.com) – Nickel development company Horizonte Minerals has received a preliminary environmental licence (LP) for the planned Araguaia nickel mine and beneficiation plant from the Brazilian Pará State Environmental Agency (Semas).

According to the Aim- and TSX-listed company, which bought the project from Glencore last year for $8-million, the granting of the LP was often regarded as the most important licence for any mining project in Brazil, as it outlined the project parameters as agreed upon by all stakeholders, and was the only environmental licensing process that required approval by the state’s Committee of Environment.

Horizonte advised that the LP, granted to its subsidiary Araguaia Níquel Mineração, was a significant milestone that demonstrated the viability of Araguaia and represented the state government’s approval for the planned project.

"This major milestone brings Horizonte another step closer to developing Brazil's next major nickel mine. Following 24 months of work the award of the LP demonstrates the Pará state government's support for the development of the Araguaia nickel project,” CEO Jeremy Martin commented, adding that the award of the LP was timely as the company was in the final stages of preparing a new prefeasibility study (PFS).

The new PFS was expected to include a revised mineral resource covering the recently acquired Glencore project, combined with infill resource drilling results, data from the full-scale metallurgical pilot plant campaign completed in the third quarter of 2015, and updated capital and operating costs.

Horizonte expected to publish the new PFS some time during the second half of the year.

Martin stated that the project provided a compelling investment case as it worked towards developing Araguaia to the feasibility stage, when viewed in tandem with the nickel market fundamentals for the next 12 to 24 months.

Analysts expected a long-term structural nickel shortage to appear from 2021, when a deficit of about 475 000 t would keep the nickel market reasonably balanced through to 2030. New production would be required to come online during this period.

NEXT STEPS
Horizonte advised that it would now focus on obtaining the installation licence (LI) which, once awarded in parallel with the mining concession, would allow construction to start.

The LI would require further detailed environmental studies, a definitive feasibility study, and further community engagement. Horizonte would also work in partnership with the state government to undertake studies identifying possibilities for use of the slag product from Araguaia and potential local industries that could benefit from the final ferronickel product.

Horizonte planned to produce 900 000 t/y of ferronickel through using a rotary kiln electric furnace.

The project was located in a mining region with access to good infrastructure including rail, road, water and power.

Araguaia held a current National Instrument 43-101-compliant resource of 71.98-million tonnes in the indicated category, with grades of 1.33% nickel and 18.48% iron, as well as 25.35-million tonnes inferred, with grades of 1.21% nickel and 23.4% iron.