Horizonte Minerals awards Araguaia ferronickel project contract
Horizonte Minerals announced yesterday that it awarded its engineering and construction contract for its Araguaia ferronickel project to Pöyry Tecnologia Ltda, the Brazilian subsidiary of global engineering services firm AFRY.
Horizonte describes its Araguaia as a tier 1 mining project with a high-grade scalable resource. The project is located south of the Carajás Mining District in the Pará State, north Brazil.
The company said return on the project is expected to go up due to the recent spike in nickel prices. The company’s feasibility study for the project used US$14,000 nickel prices. Using a more recent nickel price of $16,000, the project net present value on the stage 2 expansion case is approximately $1 billion with an internal rate of return of 30% generating free cash flow of US$3.5 billion
Horizonte CEO, Jeremy Martin commented on the construction award: “We are delighted to welcome AFRY, another world class partner to the team for the construction of the Araguaia project. AFRY is a leader in its field and has a strong track record of successfully delivering metals and mining projects. We have been working with the local Pöyry team for several months in our project execution planning phase to ensure a smooth transfer to the construction phase of Araguaia. Araguaia will be delivered according to an EPCM strategy, in partnership with AFRY. The Horizonte owner’s team will be integrated into the AFRY team with clear roles and responsibilities which is standard practice in Brazil.
