Private equity manager Appian Capital Advisory LLP closed its second mining asset investment fund at $775 million. Appian has two projects in Brazil, one of nickel, Atlantic Nickel, in Bahia; and one of copper, Mineração Vale Verde, in Alagoas. According to Guillermo Kaelin, Appian Capital’s managing partner, out of this amount, the country should receive between 20% and 25% only for the two operations.
“Besides new projects that the company is evaluating in the country, in gold, copper, nickel and lithium. We have the most advanced research in five projects.”, said Kaelin. “Appian has no restriction on the amount of capital to invest in a country. In the first fund, for example, almost 70% was invested in Brazil. It will depend on the opportunities”.
The first fund structured by Appian has raised US$ 750 million and so far around US$ 400 million has been invested in the two projects in which it operates in Brazil. The copper project at Mineração Vale Verde (MVV), in Craibas, should start operating in the second half of 2021. The expectation is that 8 thousand tons will be produced. At full capacity, MVV can produce 20 thousand tons of copper per year. The ore extracted by the company has 35% to 40% copper concentration. Currently on the market is a product with 30% copper content.
“We are still in our original plan at Mineração Vale Verde. This is an area that has very good geology and in the short term we should do more research for a potential expansion in the future,” he said.
In the nickel operation, Atlantic Nickel, in Itagibá, from 15 thousand to 18 thousand tons should be produced this year, which is considered “a stable operation”. “We are very focused on the metals that will serve the electric car market, especially nickel. We will have a lot of demand in the future”, said Kaelin.
According to the executive, Appian operates seven projects worldwide, in Australia, Mexico and Canada. “In all, we are studying about 20 projects around the world. At least this year, our goal is to have two or three more investments in Peru, Chile, Mexico, Canada or Australia”.
According to the manager, Appian targets medium-sized assets, prioritizing profitability over scale to generate maximum return. “This includes commodities used in batteries, electric vehicles and renewable energy systems, including copper and nickel. The company will also make investments in precious metals as a potential portfolio hedge,” he said.
The executive pointed out that Fund II already has 40% of the amount implemented or reserved for five investments around the world. In addition to the Brazilian projects, Appian invests in mineral sands at Kalbar Operations’ Fingerboards in Australia, which is currently under development. The private equity manager also makes contributions at the Harte Gold mine in Ontario, Canada.
The executive stated that currently Brazil is the main destination for Appian’s investments in the world. “We are very happy with the quality of the assets, of the professionals and with the support of regional governments. Brazil has a very great geological potential, there is much more to be discovered,” he said. According to him, the country will be in the investment plans of the other funds that the manager must structure. “We will make contributions in Fund III, Fund IV. Brazil is the main destination of our investments”, he said.
Valor Economico: Ana Paula Machado