Glencore inks deal for Kolosori Nickel Project
Glencore, a commodities trading and mining company, has committed to funding up to $22 million to support the development of Pacific Nickel Mines’ Kolosori Nickel Project in the Solomon Islands.
The funding will meet the pre-production needs of the project, and Glencore will acquire all of Kolosori’s nickel production for a six-year term under an amended sales agreement. The loan from Glencore will have a three-year repayment term starting after the first shipment, with no scheduled repayments due during the wet season.
Drawdown target
The project secured a mining lease in September 2022 and is expected to reach full production this year, with a capacity of 1.3 million wet metric tonnes of direct shipping nickel ore per year. Pacific Nickel owns 80% of the project, while the balance is owned by the area’s traditional landowners.
“The company anticipates that it will be in a position to effect an initial drawdown of $3m once the initial conditions precedent have been satisfied. This drawdown is expected to be imminent and will enable the company to materially advance the current development works. The balance of the facility is expected to be drawn down in due course to fund the ongoing development of the Kolosori Nickel Project. The company believes that capital payback will be achieved in under 12 months,” said Solomon Islands Pacific Nickel CEO Geoff Hiller.
