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Brazil-based Firm to Raise $421.8m to Complete and Run Phosphate, Potash and Rare Earth Elements

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Hightlights

  • Terra Brasil is raising $421.8 million for phosphate, potash, and rare earth mining.
  • The company aims for significant fertilizer production by 2028.
  • Key partnerships and future potential are highlighted.

Terra Brasil (opens in a new tab), a mining company, recently hired Brazil-based bank Genial Investimentos (opens in a new tab) as its exclusive financial advisor to attract investors for the next phase of the company. The firm seeks funding to mine phosphate, potash, and rare earth elements from a deposit in Presidente Olegário, in northwest Minas Gerais. Needed capital: R$2.4 billion or USD$ 421,866,760.

The firm seeks support from the bank, the intermediary that will identify the investors, while also structuring the deal as reported in Valor International (opens in a new tab).

How much has Terra Brasil invested thus far?

Brothers Eduardo Duarte de Freitas (CEO) and Andre Luis Duarte Freitas (CFO), have invested R$220 million (USD$38,671,119) in technical and economic feasibility studies, securing permits, and developing technologies for mineral extraction and concentration.

What’s the deposit estimate at this Brazil location?

According to initial surveys, the deposit contains 3.1 billion tons of kamafugite (opens in a new tab), which could be mined for up to 50 years.

What’s the money needed for?

The exploration of a kamafugite deposit, a volcanic rock rich in phosphate, potash, and rare earth elements. The mining area is located on the border between Presidente Olegário and Patos de Minas (Minas Gerais).

How will the deal work?

Well, the investment bank will establish a deal room for investors to enter, do due diligence and potentially make bids reports Luiz Werner Brandão, Terra Brasil’s strategy director. They hope to have the valuation ready by early 2025.

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These entrepreneurs are considering either a Series A investment round with venture capitalists or agreements with a financial or commercial investor group.

What is the company’s primary planned focus?

Fertilizer production, and it turns out “Kamafugite is a natural and organic fertilizer, highly effective for soil remineralization. We are working to concentrate its nutrients to increase efficiency,” Mr. Duarte said.

As far as fertilizer and markets in Brazil, what kinds of partnerships are put together here?

Terra Brasil partners with Federal University of Uberlândia and the Federal University of Viçosa, for the ongoing development of controlled-release fertilizers for soybeans, corn, and millet.

What’s the potential fertilizer volume?

Fertilizer production is expected to start at 100,000 tons per year, gradually increasing to 1 million tons annually. According to Mr. Duarte, the production will supply demand within a 200-kilometer radius of the deposit.

What about rare earths in this potential mine?

The potential for rare earth elements is still under research. Of the 17 elements classified as rare earths, 15 are present in the deposit, including gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, lutetium, lanthanum, cerium, praseodymium, neodymium, samarium, yttrium, and europium.

On the fertilizer side of the business what’s the timeline?

Field tests are expected to conclude in early 2025, after which the company will apply for registration with the Ministry of Agriculture.

Assuming the company can raise the capital, when would the project be live?

2028

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