The award of the full mining permit was the final step in fully permitting the project and grants the company full tenure over the asset. As announced on 4 November 2019, the company was issued a full environmental permit by the Brazilian Environmental Department ('Superintendencia Regional de Regularização Ambiental' or 'SUPRAM') which allows the company to mine and process up to 400 000 tpy of ore. This is above the current processing capacity, but both the environmental permit capacity and production capacity can be increased as demand requires.
As set out in the original sale and purchase agreement, a payment of US$1 million was to be made by the company to the original vendors of the asset on "commercial production" being achieved at Arapua. This was defined as being upon the award of the full mining permit and so will now be made. This will be made from current cash in hand. The net smelter return (NSR) of 2% will continue to be paid to the vendors. Further details on the sale and purchase agreement are contained in the Company's AIM Admission Document.
Brian McMaster, Executive Chairman of Harvest, stated: "We have been successfully mining and processing at Arapua since we were granted our Guia de Utilização or trial mining licence in December 2016 and could continue to do so until December 2021. However, as we expect to reach profitability this year and have strong growth plans to build production, it was prudent to push for the award of the full mining permit which gives us full tenure over the project.
"Under the terms of the mineral rights transfer agreement dated 22 July 2014 the company will make a payment of US$1 million to the original vendors of the project. This payment will be made from our existing cash position.
"When we started Arapua we had limited idea on its economic viability. Since then we have not only built and fully permitted an operating mine and processing facility but developed an entirely new remineralizer and fertiliser, and established a growing market for it. This is a fantastic achievement and the culmination of much hard work and I would like to thank both our team and our loyal shareholders for their unwavering support in achieving this historic milestone."
Read the article online at: https://www.worldfertilizer.com/project-news/28022020/harvest-minerals-awarded-mining-permit-for-brazil-fertilizer-project/
You might also like
Second Harvest will use the grant funding to support monthly Makin’ Groceries Mobile Market events near Waggaman, starting in 2024.