High Purity Cobalt And Nickel Sulphate From the Vermelho Project

 

LONDON - Horizonte Minerals Plc, reported the successful completion of the previously announced test work on samples of limonite ore from the Company’s 100% owned Vermelho nickel-cobalt project (Vermelho) located in the southern part of the Carajas mining district in Para state, northern Brazil. CEO Jeremy Martin said, “Producing high purity nickel and cobalt sulphate from the Vermelho project of suitable quality and grade for use in EV battery production is a major milestone in the development of the project. The Vermelho project is a value driver for the Company, it is a high-grade scalable resource, with good infrastructure and has the potential to be fast tracked to development. 

The successful completion of this sulphate test work confirms that the selected process flow sheet is suitable to treat the Vermelho ore and when combined with the earlier successful RKEF test work demonstrates that alternate process routes exist for the project. The data from the test programs will be incorporated into the Vermelho Pre-feasibility Study, for release in early H2, with the objective of demonstrating a robust set of economics for the project.

The EV market continues to grow with increased activity shown from miners and battery manufactures in securing high quality resource projects.  We see Vermelho as an attractive strategic asset with the ability to produce nickel sulphate and a non-conflict, ethical source of cobalt.

Elsewhere we continue to advance the project financing (PF) on the Araguaia Ferronickel Project, with positive interest shown from seven international banks regarding a PF syndicate. Discussions are also underway with a number of groups on product marketing and off take. The overall demand picture for nickel is robust, running at around 4% to 5% per year with stainless steel currently accounting for two thirds of demand. Crucially nickel inventories continue to be drawn down with the LME levels at around 170,000 tonnes, its lowest level in 5 years with this downward trajectory due to run through the end of the year. The medium term consensus nickel price is around US$16,200/tonne which, based on the Feasibility Economics on Araguaia, deliver over US$2 billion of net cash flow over the life of mine at a C1 cash cost of around U$6,800/t nickel placing the project in the lower quartile of global laterite nickel operations and one of a very limited number of scalable, high grade, fully permitted, construction ready projects globally.

This robust demand picture for nickel positions Horizonte well, owning 100% of two Tier 1 nickel projects, within trucking distance of each other with the potential to produce 40,000 to 50,000 tonnes per year of nickel to service both the traditional stainless and EV battery market as well a cobalt revenue stream from outside of the Democratic Republic of Congo (DRC ) and service both the traditional stainless and EV battery market”.

Summary

The Company completed bench scale hydrometallurgical test work at the test facilities of SGS in Lakefield, Ontario, Canada during Q1-Q2 2019 on representative samples of Vermelho limonite ore, averaging 1.72% Ni, 0.076% Co and 27.7% Fe. Approximately 157 kg (wet) of Vermelho limonitic ore was received at SGS. After homogenization, a sub-sample was taken for full chemical analysis. The bulk sample was then scrubbed in batches of about 25 kg using fresh water. The scrubbed ore was then screened, with the oversize ground and recycled so that all screen under-flow was used for the hydrometallurgical test work. It is noted that a beneficiation step, as would be included in a commercial plant, was not carried out in the laboratory tests.