Horizon Minerals reports a $14 million placement and a proposed merger with Poseidon Nickel, alongside key production milestones including the first gold pour at Boorara and a prefeasibility study at Penny's Find.
- $14 million capital raise to support growth and merger with Poseidon Nickel
- First gold pour achieved at Boorara Gold Project under ore sale agreement
- Prefeasibility study completed for Penny's Find Underground Gold Project
- Mining commenced at Phillips Find with toll milling arrangement in place
- Proposed merger aims to integrate Poseidon's Black Swan processing plant
Capital and Corporate Strategy
Horizon Minerals Limited (ASX: HRZ) has taken significant strides in its strategic growth plan, announcing a $14 million placement to institutional and sophisticated investors. This capital injection is earmarked to support the company’s proposed merger with Poseidon Nickel Limited (ASX: POS), a move designed to consolidate Horizon’s gold resources with Poseidon’s Black Swan processing infrastructure. The merger, subject to shareholder and court approvals, is anticipated to close by mid-February 2025, positioning Horizon as a more integrated mid-tier gold producer with enhanced processing capabilities.
Operational Milestones at Boorara and Phillips Find
Operationally, Horizon has marked a key milestone with the first gold pour from the Boorara Gold Project, located near Kalgoorlie. Following the completion of grade control drilling and the establishment of a 54,380-tonne ore stockpile, ore haulage to the Paddington Mill commenced, culminating in initial processing that yielded approximately 1,400 ounces of gold at a recovery rate of 94%. This achievement underscores Horizon’s ability to convert resources into near-term cash flow amid a robust gold price environment.
Simultaneously, mining activities at the Phillips Find Gold Project have commenced following equipment mobilization and receipt of mining approvals. Under a joint venture with BML Ventures, ore from Phillips Find is set to be processed via a toll milling agreement at the Greenfields Mill near Coolgardie, with first ore treatment scheduled for February 2025. This arrangement mitigates financial risk while allowing Horizon to focus resources on Boorara’s ramp-up.
Advancing Penny's Find Underground Project
Adding to its production pipeline, Horizon completed a prefeasibility study for the Penny's Find Underground Gold Project. The study outlines a 23-month mine life with a maiden Ore Reserve of 328.3 kilotonnes at 3.2 grams per tonne gold, projecting a free cash flow of $24 million at a gold price of A$3,600 per ounce. The underground operation is designed to produce nearly 30,000 ounces of recovered gold, leveraging toll milling arrangements to optimize capital expenditure. This project represents a financially viable addition to Horizon’s portfolio, reinforcing its medium-term production outlook.
Exploration and Resource Base
While the quarter saw limited exploration drilling, Horizon maintains a substantial resource base of 1.8 million ounces of gold across its tenements in the Kalgoorlie and Coolgardie regions. The company also holds significant silver, zinc, nickel, cobalt, and manganese assets, including the Nimbus Silver-Zinc Project and a 50% stake in the Mt Thirsty Nickel-Cobalt-Manganese Project. These diversified holdings provide optionality for future development and potential revenue streams beyond gold.
Environmental and Governance Focus
Horizon continues to prioritize environmental, social, and governance (ESG) factors, conducting internal reviews and stakeholder engagement to enhance sustainability practices. The company is committed to maintaining its social license to operate, with ongoing flora and fauna surveys and compliance with regulatory frameworks across its operations.
Financial Position and Outlook
As of December 31, 2024, Horizon held cash reserves of A$9.6 million and investments valued at approximately A$6.3 million in listed entities, including Richmond Vanadium Technology. The company’s financial arrangements include a US$5 million convertible loan facility, fully drawn. The successful completion of the Poseidon merger and the ramp-up of production at Boorara and Phillips Find will be critical to Horizon’s ability to generate sustainable cash flow and deliver shareholder value.
Bottom Line?
Horizon Minerals is poised for a transformative phase, with production ramp-up and a strategic merger set to redefine its market position.
Questions in the middle?
- Will the Poseidon merger secure the necessary approvals and deliver anticipated synergies?
- How will gold production volumes and costs evolve as Boorara and Phillips Find scale up?
- What exploration or development plans will Horizon prioritize post-merger to sustain growth?