Orion Minerals, a mining company with operations in South Africa, is on track to secure a significant $250 million binding prepayment facility from Glencore. This facility will provide crucial support for the development of its Prieska Copper Zinc Project in the region.
The agreement, which was finalized through Orion’s subsidiary, Prieska Copper Zinc Mine (PCZM), involves the sale of bulk copper and zinc concentrates. This transaction will not only facilitate the Uppers Development but also partially fund the Deeps Development at the project site. This milestone marks a significant step forward for Orion as it progresses towards achieving full operational status.
The prepayment facility, originally announced in September 2025, consists of two tranches. Tranche A will allocate $40 million for the construction and start-up of the Uppers section of the project. Tranche B, on the other hand, offers a substantial $210 million for the Deeps, with the option for an early drawdown of up to $50 million if specific conditions are met.
One of the key highlights of this agreement is the market-related return that Glencore will receive on the prepayment. This return includes a reduction in rates once commercial production commences. Additionally, the facility allows for repayment at any time without incurring penalties. The settlement of the facility will be made through the delivery of copper and zinc concentrates as per linked offtake arrangements.
In terms of security, the agreement holds first-ranking security alongside other secured lenders of PCZM. Orion has provided a guarantee for PCZM’s obligations under the facility, ensuring a robust financial structure for the project.
Before proceeding with the facility, several conditions must be met, including obtaining approvals from the South African Reserve Bank and other regulatory bodies. An updated intercreditor agreement between Glencore, Triple Flag, and the Industrial Development Corporation of South Africa is also required. Additionally, linked offtake agreements for both Uppers and Deeps bulk concentrates must be finalized with Glencore.
Orion Minerals’ managing director and CEO, Tony Lennox, expressed his enthusiasm for the agreement, stating, “This is a landmark agreement for Orion. Tranche A will fund the Uppers Development while the early drawdown of Tranche B will allow us to start work on the Deeps.” He further added that first production from the Uppers is expected around 13 months after the closing of the Prepayment Facility, with first concentrate anticipated by the end of Q1 2027.
In conclusion, the collaboration between Orion Minerals and Glencore signifies a significant step forward for the Prieska Copper Zinc Project. The financial support provided through the prepayment facility will play a crucial role in advancing the development of the project and ultimately achieving operational success.
This article, “Orion to secure $250 funding from Glencore for Prieska project,” was originally published by Mining Technology, a GlobalData-owned brand.
