Anglo Pacific Group PLC (LSE:APF, TSX:APY, OTC:AGPIF) welcomed the start of production from Brazilian Nickel PLC’s small scale PNP1000 plant at the Piauí nickel project in Brazil.
Production guidance for 2022 is for 300 tonnes of nickel and 3 tonnes of cobalt, ramping up to 1,400 tonnes of nickel and 35 tonnes of cobalt in 2023.
Anglo Pacific invested US$2mln in the project in September 2017 in return for a 1.25% royalty.
“2022 will be a pivotal year for Brazilian Nickel, during which it is anticipated they will successfully achieve multiple significant milestones, including the completion of a bankable feasibility study currently being completed by SNC-Lavalin (TSX:SNC) in relation to the full-scale project,” said Anglo Pacific in a statement.
Anglo Pacific has an option to acquire, for an extra US$70mln, an incremental 3% royalty to part fund the construction of a mine with an expected annual production capacity of as much as 24,000 tonnes of nickel and 1,000 tonnes of cobalt.
“The Piauí project has the potential to become a significant asset in the group's portfolio, with a full-scale operation contributing annual royalty income ranging between US$12.5-17.5mln at current long-term broker consensus forecasts, thus further accelerating the company's transition towards future facing commodities,” Anglo Pacific said.