TORONTO (miningweekly.com) – Canadian nickel-miner Crowflight recorded a net loss of C$5,1-million for the second quarter of 2010, compared with a C$3,3-million loss a year earlier.

The company said that it has received confirmation from Chinese suitor Jinchuan that its cash offer for the company remains valid.

Jinchuan offered to buy Crowflight for a total of C$150-million in cash in April, which represented a premium of about 47% at the time.

The offer is premised on Jinchuan obtaining 100% of the offtake from the firm's Bucko Lake mine in Manitoba, and any of the Crowflight exploration properties that are subsequently placed into production.

The offer will expire on August 31.

The Bucko Lake operation declared commercial production in June last year, but was suspended in November, after the company had trouble ramping up to full production.

The company produced 1,18-million pounds of nickel in the quarter, compared with 234 920 lb in the second quarter of 2009.

Revenue rose to C$9,7-million, from the sale of 917 977 lb of payable nickel, and commercial nickel sales settled during the quarter were realised at an average price of $10,25/lb, compared with $6,79/lb in the same period of last year.

Crowflight had received an earlier expression of interest to buy the Bucko Lake asset from shareholder Pala Investment Holdings, which broke off talks after the Jinchuan offer was announced.

Pala's representatives on Crowflight's board resigned in June and Pala sold all 152-million shares and 50,6-million warrants that it held in the company to a single buyer, King Place Enterprises, which is affiliated with China's Hebei Wenfeng Industrial Group.

SUPPLIER LIEN

Crowflight revealed on Monday that a “major” supplier to the Bucko site had filed a lien against the property for services rendered, but said that the mine operations had not been affected.

“The supplier is continuing to provide services to the site and negotiations have been under way to resolve this situation,” Crowflight said.

The company repeated earlier warnings that it will not meet its production guidance for the year, and said it is still reviewing its 2010 production plan and cost outlook for the remainder of the year.

The firm “expects to give updated guidance later this year once a steady state of production of 1 000 t/d has been achieved”.

Crowflight said in February it expected to produce 8,6-million pounds of payable nickel this year from its Bucko Lake mine, in Manitoba. Costs were forecast at between $5,70/lb and $5,90/lb of payable nickel.

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