PERTH (miningweekly.com) – ASX-listed Mincor Resources has acquired the Long nickel operation, in Western Australia, from diversified miner Independence Group for up to A$9.5-million.
The Long nickel operation was placed on care and maintenance in mid-2018, following the production of more than 135 000 t of nickel-in-ore, with the project estimated to have a mineral resource of some 32 000 t of contained nickel.
Mincor told shareholders on Thursday that the acquisition consolidated the company’s dominant land-holding in the Kambalda district, adding a significant new leg to its extensive nickel sulphide portfolio, and to its plans to restart nickel production.
“This is a well-timed strategic opportunity for Mincor, which represents a value-accretive and logical consolidation step in the context of our broader plans to restart high-grade nickel sulphide mining in the Kambalda district,” said Mincor MD David Southam.
“As well as expanding our strategic footprint in the North Kambalda Dome, the acquisition of the fully maintained mine infrastructure at Long opens up opportunities to exploit the existing high-grade mineral resource, which contains 32 000 t of nickel and provides potential to enhance capital and operational efficiency by accessing our nearby Durkin North ore reserve from the Long decline.”
Southam said that Long also offered exciting near-mine resource and exploration opportunities, including potential extensions of the high-grade nickel channels such as Moran South, Victor and Gibb, and a new lightly drilled upper channel position, which could be contiguous with the Durkin project area.
“We intend to pursue these opportunities to grow the resource base in the highly prospective and under-explored area adjacent to Independence’s and Mincor’s tenement boundaries, leveraging off underground exploration platforms that can be established with any development drives to access Durkin North from Long.”
Under the terms of the acquisition, Mincor would pay an upfront consideration of A$3.5-million, through the issue of more than 7.77-million fully paid Mincor shares. The shares will be issued under the company’s existing placement capacity.
In addition, Mincor could pay up to A$6-million in additional consideration with the achievement of a number of milestones, including the production of 2 500 t of contained nickel in ore, and the production of 7 500 t of contained nickel in ore.
Mincor will pay the contingent amounts in either cash or Mincor shares.
Independence MD and CEO Peter Bradford said on Thursday that Long had been an important part of Kambalda’s history since the 1970s, and a key driver of growth for the company since its acquisition in 2002.
“While Independence recognises the opportunity for future discovery at Long, we are focused on belt-scale discoveries aligned with our strategy to be a globally relevant supplier of metals critical to clean energy and energy storage.”
The sale of the Long operation is scheduled for completion by the end of this month.