Harvest Minerals Ltd (AIM:HMI, OTC:HMIFF) said it decided not to go ahead with the acquisition of the Miriri phosphate project in Brazil after conducting due diligence.
The AIM-listed fertiliser producer said the geological and economic merits of the project did not reach Harvest's minimum investment criteria.
Specifically, it concluded that a direct shipping operation would not be possible as the majority of the ore is at depth and the extraction of the ore and corresponding over burden rendered the project relatively uneconomic.
Harvest said it has terminated the previously announced agreement with the vendors and relinquished its interest in the project. In November Harvest said it had entered into a share purchase agreement to buy BF Mineração Ltda, owner of the Miriri project.
No further payments are due to the vendors, it said.
“Since identifying the Arapua project in 2015, Harvest has been actively looking for further greenfield and advanced projects to expand our reach,” said chairman Brian McMaster.
“It is proving very difficult to identify and secure appropriate projects which illustrates the importance of Arapua as a secure, organic, domestic fertiliser source. We had high hopes for Miriri project, and it is disappointing that the detailed due diligence didn't reconcile to the historical data.”
Harvest said it will continue to look for greenfield and advanced projects.