Australian firm Cyprium Metals has signed a letter of intent (LoI) with commodities trader Glencore for an offtake prepayment facility of A$50m ($34.6m) for its Nifty Copper project in Western Australia.

The facility would help Cyprium fund the restart of the project, including contingencies, capital expenditure, working capital, and financing costs.

In exchange, Glencore will receive 100% copper cathode produced during Phase I of the Nifty Copper Project restart. The firm will receive a maximum of 120,000t.

Cyprium said the Offtake pricing of copper cathode shipments will be determined based on average market rates.

According to the exclusive LoI, the two parties will jointly work towards finalising the project’s outstanding due diligence activities, and funding documentation for execution.

Cyprium managing director Barry Cahill said: “We are very pleased to enter an exclusive Letter of Intent for a Copper Cathode Offtake Secured Prepayment Facility with Glencore. This is part of a fully funded finance package for the restart of the Nifty Copper Project.

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“The restart project economics are very robust, and we have continued to make further improvements to the Nifty Copper Project during the financing process.

“We are looking forward to completing our total funding package so that we can commence executing our Nifty Copper Project restart development plans.”

Located on the western edge of the Great Sandy Desert in the north-eastern Pilbara, Western Australia, the Nifty Copper Mine started operation in 1993 as an open-pit oxide copper mine.

It was transitioned to an underground sulphide mine in 2006. Production at the mine was suspended in 2019 and it was placed under care and maintenance for lack of viability to continue the recovery of resources economically.