Orion Minerals’ (ASX:ORN) subsidiary Prieska Copper Zinc Mine has signed a non-binding term sheet with Glencore (LSE:GLEN) for financing of between US$200-250 million ($299-373.95 million) and concentrate offtake for the Prieska Project in South Africa.
The proposed financing will be made available under two tranches, with the first US$40 million tranche to be used for the construction and startup of the Uppers at Prieska.
Tranche two, totalling between US$160-210 million is intended for the construction and startup of the Deeps at Prieska, of which US$50 million may be drawn early to begin early works on Deeps.
Under the facilities, Glencore is required to complete due diligence which has begun. Drawdown will be based on milestones for each tranche, which will be agreed upon the due diligence process. The first drawdown under tranche one is targeted for November 2025.
Orion CEO Tony Lennox says this enables the company to transition into a producer.
“Tranche A enables the company to move swiftly into first production and first cashflow from mining of the Uppers at Prieska,” Lennox says.
“Crucially, the early drawdown of Tranche B allows Orion to commence early works on the Deeps in accordance with the Prieska Definitive Feasibility Study (DFS). This will allow for smooth and continuous operations as we move from the Uppers towards full-scale operations from the Deeps.”
Toby Spittle, Glencore Copper Marketing, says the company has been following the progress being made at Prieska.
“We look forward to playing our part in financing the mine’s development and subsequent marketing of the concentrates,” Spittle says.
The Prieska Mine, historically mined between 1970-1990, is one of the world’s top 30 volcanogenic massive sulphide base metal deposits, with a recorded production of more than 430,000 tonnes of copper and 1 million tonnes of zinc.
Glencore is a globally diversified natural resources company and a producer of more than 60 commodities.
Orion Minerals is a base metals-focused developer with two production hubs in South Africa.
Write to Aaliyah Rogan at Mining.com.au
Images: Orion Minerals
