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Horizonte Minerals remains committed to advancing Lontra Nickel Project at a clip

Published: 10:06 04 Jun 2010 BST

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In its final results, Horizonte Minerals (LON:HZM) told investors that it is well placed to benefit from a renewed optimism in the resource sector in 2010, after the company’s strong progress in 2009. In particular, the company noted the strong growth in nickel prices, which have climbed from below US$6/lb up through the US$10/lb, consequently Horizonte Chairman David J. Hall said that the company will continue to fast-track the Lontra nickel laterite project

Horizonte said it made excellent progress during 2009, despite difficult market conditions. In September 2009, it successfully raised £1.3 million in a placing to provide cash resources to aid develop its projects. “We continue to add value to our portfolio of gold, silver and base metal projects in Brazil and Peru through exploration development and securing partnerships with mining majors”, Horizonte stated.

Furthermore, the company noted the potential US$9m worth of exploration expenditures marked for its projects, through its three active partners - AngloGold Ashanti, Troy Resources NL and LGA Mineração e Siderugia Ltd.
 
In relation to the nickel market, Horizonte highlighted that the strong economics are driven by a rapid increase in stainless steel production, combined with slowing global production – with Q1-2010 production 8% lower than the all-time highs of two year ago, Q1-2008. 

“In the industry, a number of nickel exploration projects were dropped during the financial downturn and are unlikely to be revived.  Meanwhile ongoing strikes at Vale Inco's Sudbury and Voisey's Bay operations will cause ongoing disruption to nickel supply. In this vein, I believe new nickel projects will be required”, Horizonte said. 

At the Lontra nickel project, in the Carajas Mineral Province of Northern Brazil, in-fill soil sampling has been completed and further targets have been identified. Horizonte has been preparing the project to re-commence resource definition drilling for Q4 2010 - one of the company’s main priorities in 2010. 

The company also noted a ‘critical need’ globally for new gold project’s, particularly as the gold price is sustained above US$1,100/oz. In September, it signed a strategic association agreement with AngloGold, which was described, by Horizonte as ‘a major achievement and a testament to the technical team’s quality’.

The alliance forms part of a US$5.3m three-year target generation and development program, for new gold mineralisation in two areas of Brazil. Exploration commenced in October 2009.

In terms of its other gold projects, Horizonte highlighted that its Tangara gold project, in partnership with Troy, made good progress during the period, with work focussed on the Malvinas Trend, in particular the Gerson Zone, with the aim to delineate a resource/reserve statement.

“We are currently awaiting Troy's decision on whether it will exercise its option by paying Horizonte US$2 million and entitling your Company to a US$30/oz royalty on production from the licences.  We are working closely with Troy and will keep the market informed on these developments in due course”.

Also in 2009, Horizonte signed a 50:50 joint venture agreement with LGA in April, to finance six early stage projects and identify and acquire suitable bolt-on mineral projects.  LGA will provide US$441,000 of funding over course of the agreement’s first year.
 
The JV is currently focussed on two key project areas - comprising the Goias nickel sulphide project and the Sao Felix generative programme.  According to Horizonte the JV will advance these targets through to a drilling stage later in 2010.

“Horizonte share price has seen a solid recovery through 2009 with results from our association with AngloGold, ongoing developments with Troy and further news from other activities especially Lontra, we will aim to maintain this trend through 2010”, David J Hall concluded.

For the twelve-months ended 31st December 2009, the junior mineral exploration company reported a narrowing loss of £886,357 (FY08: £1.49m), equating to 1.94p per share (FY08: 3.7p).

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