Photo by: Bloomberg
PERTH (miningweekly.com) – Nickel explorer Sirius Resources has moved to acquire the outstanding 30% interest of its flagship Nova-Bollinger project, in Western Australia.
The company said on Friday that it had entered into a binding agreement to acquire the outstanding interest from Mark Creasy in exchange for 70.6-million Sirius shares and A$28-million in cash.
The cash consideration would be fully funded from Sirius’ existing cash reserves.
“Reaching agreement to consolidate 100% ownership of what we believe will emerge as one of Australia’s leading nickel mines is an important milestone for Sirius and its shareholders,” said Sirius MD Mark Bennett.
He added that the agreement had been structured in a manner which delivered the company full ownership, yet left Sirius in a significant cash position to complete the definitive feasibility study and continue with its exploration programme.
“We are confident that the acquisition will prove to be beneficial for Sirius shareholders, removing many of the complexities otherwise faced by Sirius as we progress negotiations in respect of project finance and offtake arrangements and then start development of the Nova-Bollinger project.”
A 2013 scoping study has estimated that at a capital cost of A$471-million, the project could produce 28 000 t/y of nickel and 11 000 t/y of copper in concentrate, over an initial mine life of ten years.
Using a flat $0.90/A$1 exchange rate, the project could generate revenue of some A$4.6-billion and net cash flow of A$2.8-billion over its mine life.