Develop Global (ASX:DVP) has made final investment decisions (FIDs) on its Sulphur Springs copper-zinc and Pioneer Dome lithium projects after securing a US$400 million ($569.81 million) financing package from global commodities trader Trafigura.
The company has entered into a US$350 million loan facility and US$50 million warrant package with Trafigura, alongside binding offtake agreements covering copper and zinc concentrates from Sulphur Springs and direct shipping ore from Pioneer Dome.
Managing Director Bill Beament says the agreements are ‘transformational for Develop’, setting the company to acquire three projects producing highly sought-after metals in tier-one locations.
“The growth outlook for our cash generation is now exceptional. Woodlawn is now operating at steady-state production rates, and we have already completed significant construction work and underground development at Sulphur Springs,” Beament says.
The company expects first concentrate production at Sulphur Springs in the June 2028 quarter, with the project requiring $450 million in capital expenditure.
Pioneer Dome will commence direct shipping ore sales in the December 2026 quarter, following $40 million in pre-production capital investment.
Project details and financial outlook
Global Head of Trafigura’s Metals and Minerals Gonzalo De Olazaval says the financing facility enables Develop to take FIDs on two critical minerals projects in Australia.
“This transaction exemplifies what Trafigura does best: working alongside strong management teams and leveraging our financial strength and market expertise to help bring the critical industrial and battery metals the world needs to market,” De Olazaval says.
Develop will also issue approximately 7.78 million warrants to Trafigura, exercisable at $9.12 per share, which is a 50% premium to the company’s 20-day volume-weighted average price.
The Sulphur Springs project, located 110km southeast of Port Hedland, will produce separate copper-silver and zinc concentrates from an underground mine processing 1.5 million tonnes per annum.
Pioneer Dome, situated 130km south of Kalgoorlie, will initially produce 850,000 tonnes of direct shipping ore through open pit mining of the Cade deposit over 12 months.
Develop Global expects to generate $201 million in pre-tax free cash flow, with a payback period of approximately two months from first sales.
Write to JC Villarba at Mining.com.au
Images: Develop Global
