Being a fertiliser company, Aguia Resources Limited (ASX:AGR) has its primary focus on development, exploration and investment in the resources sector through a detailed emphasis on its phosphate projects as well as copper exploration portfolio in Brazil.
The Company has been striving for the advancement of its Três Estradas Phosphate Project, which represents a lucrative opportunity for the Company with its potential to serve the high domestic demand of phosphate in the Brazilian agriculture sector.
Obtaining Preliminary License
In October 2019, the Company had cleared a key milestone in the mine permitting, and development process for the Três Estrades Phosphate Project in southern Brazil by obtaining a Preliminary License (LP) for the development of the same subsequent to the approval of the Environmental Impact Assessment (EIA) by the Rio Grande do Sul State Environmental Agency (FEPAM).
Progress for Installation License
Upon receiving the LP, the Company had immediately sought to initiate the next stage of permitting which is the granting of the Installation License (LI) that could permit the construction of the project according to detailed plans and specifications, including the programs and control measures detailed in the LP.
LI is said to be the sole major outstanding permit required to commence construction, and upon receiving the same from the FEPAM, the Company looks forward to commencing the earthworks, civil works and installation of the processing unit. Further, Aguia shall reach the final doorstep of the licencing journey, which is obtaining an Operation License (LO).
LO is granted by FEPAM and requires the inspection of the constructed mine and processing plant to ensure compliance with all Brazilian mining codes and is granted upon confirmation that the site installation was completed strictly within the guidelines detailed in the LI and LP.
Aguia’s Managing Director, Dr Fernando Tallarico commented:
“By delivering all the mandatory programs and plans to the Rio Grande do Sul Environmental Agency during the course of 2020 we expect to be granted the LI in the first quarter of 2021 so that we can commence construction at that time.”
Nevertheless, Aguia’s team has been putting significant efforts in obtaining the Installation License from the concerned authority and has been actively engaged in progressing towards four key initiatives:
Environmental Programs and Plans:
Along with continuity in the archaeological survey-related work during March 2020, a team of well-reputed consultants with specialization in environmental permitting have been nominated to execute the compulsory environmental programs and formulate environmental plans for the LI scheduled for filing in Q4 2020, including:
General environmental management and environmental risk management programs includes,
- Safety Protocols
- Environment And Health Program
- Environmental Monitoring
- Environmental Audit And Compensation Plan
- Construction And Mine Closure Plan
Progress has been continuously made towards the development of the detailed engineering plans for Phase 1 of the Phosphate Project, including detailed construction plans as well as descriptive memorials in accord with the conditions of LP.
The preparation of plans is a requisite for obtaining the LI and is bound to be presented to FEPAM in Q3 2020. The Company looks forward to applying for the same, subsequent to the optimisation and design, mine scheduling and processing plant designs presented in the Scoping Study, that was conducted and prepared by GE21 Consultoria Mineral Ltda.
Filing with the Brazilian Mining Agency:
As part of the Mining Permitting Application process, the Brazilian law requires lodgement with the Brazilian Mining Agency (ANM) of an Economic Assessment Plan (PAE) that reflects the Company’s financial capacity to implement the project as well as economic viability of the project.
The approval of PAE from the Brazilian Mining Agency is a requisite for the issue of Installation Licence; however, the conclusion of the PAE is conditional on the approval of Final Exploration Report for the mineral covering the Três Estradas Phosphate Project.
Further, Aguia looks forward to:
- Receiving RFP approval in Q3 2020
- File the PAE with ANM in Q4 2020
- Receive ANM approval Q1 2021
Proof of Land Ownership:
Another requisite for obtaining the LI is the proof of ownership or possession of the land properties covering the mine site. Under this condition, all the supporting documentation of land negotiations for the area planned for the project, along with the mapping of all areas previously acquired or leased for a time equivalent to or exceeding the anticipated duration of the project.
Moreover, the acquired or leased properties must be described in accordance with the requirements described in the land acquisition program of the Environmental Impact Assessment.
Aguia has already completed a detailed evaluation of all properties that cover the project with report encompassing an assessment of all properties in the project area completed by Vaz de Melo Consultoria Ltd.
Moreover, the Company also looks forward to hiring a specialized land acquisition realtor to facilitate the negotiations with the landowners.
Further, AGR anticipates finalising the preparation activities and completing purchase agreements by Q4 of the year 2020 along with final payment and acquisition of the properties expected to take place in Q1 2021.
The Company has provided the following planned timeline of activities to be undertaken for the granting of the LI with the condition that some milestones presented in the timeline are subject to approval from government agencies.
Planned timeline of activities for the granting of Installation Licence (Source: Company's Report)
The Company also mentioned that the delays that are likely to be caused due to the COVID-19 pandemic are partially assessed.
The Company management believes that AGR is progressing well with encouraging support from the local community as well as related local authorities that is likely to fuel the emergence of the Company as a robust, home-based phosphate producer contributing towards the growth and development of Brazilian agribusiness sector.
Aguia also looks forward to hosting a webinar for its investors at 11:00 AM AEST on Wednesday 8 April 2020 to provide an update about the Company in a 30-minute session.
The AGR stock settled at a price of $0.070 on 07 April 2020 with a market capitalisation of $15.88 million.
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