Horizon Minerals Limited (ASX: HRZ) has met the Tranche 2 Conditions Precedent to the drawdown funding of US$3.0 million (A$4.36 million) to advance development of the Cannon underground gold project in Western Australia.
Horizon executed a Loan Agreement and General Security Deed with Nebari Partners LLC dated 23 November 2022 for a US$5.0 million secured loan facility.
The Facility is comprised of a two tranche Convertible Loan Facility with US$2.0 million in Tranche 1 and US$3.0 million in Tranche 2. Tranche 1 was drawn down on 29 November 2022 to enable the deferred payment for the Cannon gold project acquisition, with Tranche 2 subject to the satisfaction of Conditions Precedent and Subsequent to the Loan Agreement, including Horizon shareholder approval and Nebari Investment Committee approval.
All Conditions Precedent and Subsequent to the Loan Agreement have been satisfied and now the Nebari Investment Committee has granted final approval. The Tranche 2 funds have been received by Horizon and are available for use.
Horizon has also secured all necessary approvals to commence the underground development, inclusive of an approved Mining Proposal and Mine Closure Plan from DMIRS, and a groundwater licence and works approval for dewatering and pipeline construction from DWER.
The Cannon Feasibility Study was released on the ASX on 29 March 2022 and demonstrated positive economic results. Horizon has also secured a 200kt processing allocation with FMR Investments (FMR) via the Greenfields Plant.
Formal mining and processing contract / JV negotiations are well underway with preferred partner FMR, following which the Horizon Board will make a formal Financial Investment Decision for the development of the Cannon project.
The company plans to implement its clear goal of bringing a sequence of underground projects into production, commencing with Cannon, followed by the Penny’s Find and Rose Hill projects which are currently under evaluation.
The company now has a strategy of generating continuous cash flow from all of Horizon’s JORC resources via contract / JV in this high Australian dollar gold price to support the large-scale exploration program and future mine developments across our core assets.
We are very pleased to receive the funds from Nebari in line with the agreed terms of our Loan Agreement and on competitive commercial terms. This now leaves Horizon with the startup capital and approvals needed to advance the Cannon gold project into development and production in the second half of 2023,” Incoming CEO, Grant Haywood, said.