PERTH (miningweekly.com) – Brazil-focused explorer Centaurus Metals has raised A$10-million to fund an aggressive exploration and development programme at its recently acquired Jaguar nickel sulphide project.

The company will issue one-billion shares, at a price of 1c each, to institutional and sophisticated investors, over two tranches.

The first tranche, comprising over 592.3-million shares, will be issued under the company’s existing placement capacity, while the second tranche of over 407.6-million shares will be subject to shareholder approval at a general meeting to be held in October.

Centaurus MD Darren Gordon on Tuesday said that the response to the capital raising, including from several new sophisticated and small-cap institutional investors, reflected the quality, scale and potential of the Jaguar asset.

“This is a transformational acquisition for Centaurus, and has been acknowledged as such by the incoming investors, who share our view that this is a rare exploration and development opportunity in the nickel sulphide sector globally.”

Centaurus earlier this week struck a formal sale and purchase agreement with major Vale over the Jaguar project, under which it would make an initial $250 000 cash payment and transfer its Salobo West exploration licence and exploration licence applications to Vale.

On the start of a bankable feasibility study or construction funding being secured, or three years from the signing of the agreement, Centaurus would pay Vale a further $1.75-million.

A further $5-million will become payable on first commercial production, with Vale also due a 0.75% net operating revenue royalty on all concentrate produced at Jaguar.

The Jaguar project is estimated to contain a resource of 40.4-million tonnes, grading 0.78% nickel for a total of 315 000 t of contained nickel.

“With the company’s existing cash, we are now fully funded to undertake extensive infill and resource definition drilling on the high-grade zones of mineralisation at Jaguar over the next 12 months, together with further metallurgical testwork to put ourselves in a position to report the company’s maiden Joint Ore Reserves Committee resource in the second quarter of 2020,” Gordon said on Tuesday.

He noted that with nickel prices rising strongly in US dollar terms since the start of the calendar year, on the back of declining stockpiles, a diminished global supply pipeline and surging demand from the electric vehicle lithium-ion battery sector, now was a great time to advance a quality nickel sulphide project towards development.