Major coal miner Glencore will loan Pacific Nickel Mines over $32 million to advance the Kolosori nickel project in the Solomon Islands.
Pacific Nickel was granted a mining lease for Kolosori, an advanced stage direct shipping nickel project, in September 2022.
The funds raised through the agreement with Glencore will provide Pacific Nickel with the pre-production funding requirements of the project.
“Pacific Nickel has established a strong working relationship with Glencore who, by executing these documents, has confirmed its commitment to the development of the Kolosori nickel project,” Pacific Nickel chief executive officer Geoff Hiller said.
“Pacific Nickel believes that capital payback will be achieved in under 12 months.”
Under the loan agreement, Pacific Nickel will have a three year repayment term, with no scheduled repayments due during the wet season months.
As well as a nickel mine, Kolosori will also feature a haul road, wharf and port facilities, construction and worker camps and a contract mining facility.
Much of that work will commence now that financing is in place.
“Pacific Nickel Mines is pleased to confirm that the Kolosori nickel project has advanced further into the execution stage with critical path construction work now underway,” Hiller said on April 17.
“A review of the development strategy has identified ore blocks which can potentially be mined earlier than that assumed in the DFS (Definitive Feasibility Study).
“These ore blocks lie adjacent to the proposed haul road and early mining of these ore blocks is expected to enhance the project’s economics.
“The company has recently completed an infill drilling program within these early ore blocks to assist with mine planning. This will be followed by grade control drilling to confirm the outline of the ore blocks.”
Pacific Nickel owns 80 per cent of Kolosori, while the remaining 20 per cent is held by the traditional landowners of the area.