Brazilian Nickel Limited (“BRN” or the “Company”), a private company with primary nickel and cobalt production in Brazil using proprietary technology, is pleased to announce that the Company has received a letter of interest (“LOI”) from the U.S. International Development Finance Corporation (“DFC”) that expressed DFC’s interest in providing the Piauí Nickel Project (“PNP” or the “Project”) with a loan facility of up to US$550m representing almost 40 percent of the Project’s overall financing package.
Danielle Montgomery, DFC’s Acting Vice President of Infrastructure and Critical Minerals, commented, “Brazilian Nickel’s Piauí Nickel Project represents an opportunity to advance critical mineral development in Brazil, diversify critical supply chains, and foster economic growth in the region. DFC is committed to advancing the global energy transition by supporting world-class projects that drive economic development and growth, while advancing U.S. strategic interests in the region.”
Mark Travers, CEO of BRN, said, “We are grateful for the incredible support we have received from DFC throughout this process, and we are excited to continue our collaboration to convert the LOI into a committed financing facility in early 2025. It is a clear indication of the potential value of this project to Brazil, the U.S., and the world.”
The Project is an advanced-staged nickel laterite project located in the State of Piauí, Brazil. BRN’s successful application of heap leaching technology to nickel laterite orebodies is a materially less capital-intensive process than traditional high-pressure acid leaching (known as “HPAL”). Heap leaching therefore permits the exploitation of resources that cannot support the much higher capital burden of HPAL, giving BRN a competitive advantage.
The Project was also recently awarded the Nickel Mark in recognition of its environmentally and socially responsible practices. Additionally, with an average production rate of 27,000 tonnes per annum of nickel and 900 tonnes per annum of cobalt across the first 10 years of operation, BRN is on track to become a globally significant nickel producer that is well-positioned to provide non-PRC-controlled critical minerals for the developing EV supply chain, which now demands a low-cost premium product alternative with strong ESG credentials. Furthermore, Brazilian Nickel’s mission is to secure critical metals supply chains, enhancing global resilience and supporting industrial competitiveness for the United States and its allies.
Funding Strategy
As set out in the Company’s announcement dated September 6, 2024, BRN’s financing strategy consists of three primary sources of funding: (i) a limited recourse project finance facility, in the form of senior debt; (ii) partnerships with other equity investors, either through an investment in the Company or joint venture arrangements at the Project level; and (iii) a royalty instrument.
BRN’s senior debt funding strategy has been to target a syndicate of lenders largely consisting of government-backed institutions, led by DFC. The lenders are in advanced stages of their due diligence and have recently completed a site visit to the Project in Brazil.
