Full steam ahead for Pacific Nickel Mines
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Special Report: Pacific Nickel Mines will fund exploration and development of its Kolosori and Jejevo projects with the proceeds of a $3.8 million capital raise.
The raising will be put towards work on the Pacific Nickel Mines’ (ASX:PNM) suite of Solomon Islands projects, including the preparation of a definitive feasibility study, and for working capital and general corporate purposes.
The placement was significantly oversubscribed and will see 76 million shares issued at 5c each to raise $3.8 million with a pre-capital raise market cap of ~$7M.
Jejevo and Kolosori are both located on Isabel Island in the Solomon Islands, and are both considered near-term development assets.
Both projects are advanced stage direct shipping ore nickel laterite projects with excellent potential for rapid development at what the company said was relatively modest capital expenditure. An initial JORC resource estimate for Kolosori of 5.89 million tonnes at 1.55% nickel, at a 1.2% nickel cut-off has already been confirmed. The Company has also announced a near term Exploration Target in the range of 4.9Mt to 6.6Mt at 1.4% Ni to 1.6% Ni at Jejevo.
PNM has also gained strong support of local landowners to progress with exploration and development of both Projects with local landowners retaining a 20% interest at the project level for both projects as well as receiving equity consideration through both transactions.
Speaking on the completion of the raising, Pacific Nickel CEO Geoff Hiller said the company was excited to be able to progress the projects and deliver value for shareholders.
“This placement marks a significant milestone for the Company and will allow us to advance exploration and development activities at the Kolosori and Jejevo Nickel Projects,” he said.
“The heavily over-subscribed placement is a true show of support from our existing and new shareholders and the company can now apply a focused effort to building out the resources across both projects and advancing towards production”
Pacific Nickel Mines, which was formerly Malachite Resources, aims to submit mining lease applications over the projects next year while carrying out targeted exploration to increase confidence and size in its existing resources.
The capital raising is the latest in a steady stream of news out of PNM over the last few months, starting with the acquisition of 80% of Sunshine Minerals in October with the remaining 20% owned by local landowners.
That purchase gave PNM access to Jejevo – a project close to the coast with no processing requirements, a low capital route to direct shipping and local landowner support.
The project was previously drilled in 2013, and PNM plans to confirm a 2012 JORC resource at earliest opportunity.
That same month, Pacific executed a share purchase agreement to pick up an 80% interest in Kolosori Nickel – the owner of the namesake project which is again held 20% by local landowners.
In November, PNM announced an initial JORC resource estimate for Kolosori of 5.89 million tonnes at 1.55% nickel, measured to a 1.2% nickel cut-off.
With further funding at its disposal, it’s fair to expect more regular newsflow out of the Solomon Islands-focused developer in 2021.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.