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PERTH (miningweekly.com) – Metals developer Cassini Resources has announced plans to raise up to A$8-million to fund project studies and exploration at its Nebo-Babel nickel/copper prospect, in Western Australia.
The company said on Thursday that it would place about 97-million shares, at a price of 6.7c each, to raise an initial A$6.5-million. The shares would be issued in two tranches, with the first tranche issued under the company’s 15% placement capacity.
Cassini noted that the offer price was a 16.25% discount to the company’s last closing price of 8c a share.
The placement has been well supported by existing shareholders, with contractors Maca and GR Engineering Services both committing to subscribe for a significant number of shares.
In addition to the placement, Cassini would also undertake a share purchase plan to raise an additional A$1.5-million. Eligible shareholders would be entitled to apply for up to A$15 000 worth of new shares, with shares to be priced at 6.7c each.
Cassini MD Richard Bevan said that the strong support received for the placement had validated the quality of the Nebo-Babel project, where a recent scoping study demonstrated that the project would deliver low operating costs, a long mine life, and substantial nickel and copper production.
The scoping study proved Nebo-Babel to be economically viable at a range of different mine production and processing rates, with the study identifying two preferred scenarios, including a four-million-tonne-a-year base case and a staged development, which would start production at 1.5-million tonnes a year, and expand to four-million tonnes a year after eight years.
In the base-case production scenario, the Nebo-Babel project would deliver 12 300 t/y of nickel-in-concentrate and 14 300 t/y of copper-in-concentrate, over an initial mine life of 15 years. The project would have an average C1 cash operating cost of $1.82/lb, and would generate life-of-mine revenue of A$6.7-billion.
The base-case model would require a capital investment of A$432-million and would deliver a net present value of A$1.14-billion, and an internal rate of return of 70%.
The proceeds from the placement would be used to complete a prefeasibility study on the Nebo-Babel project, as well as to conduct resource definition drilling and drill testing of the Succoth prospect.