Orion Minerals is set to secure a $250m binding prepayment facility from Glencore to support the development of its Prieska Copper Zinc Project in South Africa.
The agreement, executed through Orion's subsidiary, Prieska Copper Zinc Mine (PCZM), involves the sale of bulk copper and zinc concentrates, facilitating the Uppers Development and partially funding the Deeps Development at the project.
This marks a significant advancement in Orion’s move towards full operational status.
The prepayment facility, first announced in September 2025, comprises two tranches.
Tranche A provides $40m for the construction and start-up of the Uppers section of the project. Tranche B offers $210m for the Deeps, with an option for an early drawdown of up to $50m if certain conditions are met.
Glencore's return on the prepayment is market-related and includes a reduction in rates once commercial production begins. The facility allows repayment at any time without penalty.
Settlement of the facility will occur through the delivery of copper and zinc concentrates per linked offtake arrangements.
The agreement holds first-ranking security alongside other secured lenders of PCZM, with Orion guaranteeing PCZM's obligations under the facility.
Furthermore, several conditions must be met before proceeding, including obtaining approvals from the South African Reserve Bank and other regulatory bodies.
An updated intercreditor agreement between Glencore, Triple Flag, and the Industrial Development Corporation of South Africa is required.
Additionally, linked offtake agreements for both Uppers and Deeps bulk concentrates must be concluded with Glencore.
Completion of work scope and expenditure allocation for Uppers is also necessary.
For Tranche B activation, Glencore must secure non-recourse funding from third parties for its prepayments.
Orion Minerals managing director and CEO Tony Lennox said: “This is a landmark agreement for Orion. Tranche A will fund the Uppers Development while the early drawdown of Tranche B will allow us to start work on the Deeps.
“We expect first production from the Uppers 13 months after closing of the Prepayment Facility, which is now expected around the end of March 2026 due to a short delay in finalising this agreement and the delivery timing of long lead time equipment orders. Consequently, first concentrate is now expected at the end of Q1 2027.”
