On 31 July 2024, Poseidon Nickel Limited (a wholly owned subsidiary of Horizon) entered into an agreement with Encore Minerals to develop the Windarra Gold Tailings Project. In November 2024 the parties agreed all conditions precedent set out in the agreement had been satisfied or waived and the agreement is now unconditional.
The base case DFS economic outcomes were a net operating cashflow of $30.6M with a Net Present Value (NPV8) of $21.7M and an IRR of 50.6%, assuming a gold price of A$2,500/oz. Since the release of the DFS the gold price has increased significantly to above A$4,700/oz, which should significantly improve project economics.
Encore intends to use its proprietary Glycine Leaching Technology (GlyCatTM + GlyLeachTM) to process the tailings. There is potential for the patented technologies to also process the nickel tailings from Windarra, which could add further value to the Project.
Per the agreement, Encore is to update the DFS to include both gold and nickel tailings at Windarra and depending on project economics the Lancefield gold tailings. Under the Agreement, Encore is responsible for the funding, development, operation, closure and rehabilitation of the project.
Pursuant to the agreement, Poseidon is to receive:
- an up-front non-refundable payment of $250,000 upon signing of the agreement and the commencement of a testing period (received in August 2024);
- further payments totalling $1.0 million, being $0.5 million upon commencement of development period and $0.5 million upon commencement of production period, subject to certain conditions;
- NSR royalty of 3% on production; and
- $1.6 million towards the existing rehabilitation bond for Windarra.
The Project is located approximately 720km north-east of Perth, 260km north north-east of the major mining town of Kalgoorlie, and about 18 km north-west of Laverton. It is serviced by sealed roads from Kalgoorlie via Leonora to Laverton.
