Anglo Pacific Group has signed an agreement to acquire a 1% gross revenue royalty (GRR) interest over Brazilian Nickel's (BRN) Piauí nickel-cobalt project in north eastern Brazil.
The agreement is consistent with Anglo Pacific’s strategy to invest in development opportunities that complement its existing portfolio of assets.
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Under the agreement, in order to acquire the GRR, Anglo Pacific will offer an initial payment of $2m to BRN. This will use the amount for the development of a Ni and Co pilot plant with a nameplate production capacity of 1,000t per annum of Ni.
Anglo Pacific has the right to earn additional GRR for a total of up to $70m, which is based on approval from its board and the achievement of certain development milestones.
Anglo Pacific Group CEO Julian Treger said: "The Piauí royalty reflects the company’s strategy of investing into earlier stage, high-growth potential royalties.
"Combined with our Maracás Menchen vanadium royalty, this investment also represents a continuing strategic pivot into metals which are exposed to the burgeoning electric vehicle story."
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By GlobalDataThe project has measured resources of 52.9Mt at 1.03% Ni and 0.05% Co, in addition to indicated resources of 19.3Mt at 0.92% Ni and 0.05% Co at a 0.6% nickel cut-of-grade.
Treger further added: "The royalty will deliver further diversification for the company’s asset base and commodity exposure in a lower risk manner through the incremental structure of the investment, and has the potential to deliver very high returns once in production."
