ONTARIO - Toronto-based First Nickel is moving forward with a C$25-million equity offering. The money raise will be used to reopen the Lockerby mine near Sudbury.
First Nickel acquired the mine from Falconbridge in 2005 and achieved commercial levels of production the following year. The project yielded 364,000 tonnes of ore before it was placed on care-and-maintenance due to low metal prices in October 2008.
A feasibility study for reopening was produced in 2009. It indicated that the mine could produce 51.7 million lb of nickel, 34.4 million lb of copper, 1.0 million lb of cobalt. PGE and precious metals over a 6.5-year life. Unit cash costs were estimated to be US$4.56 million per pound of nickel net of byproduct credits. Pre-production capital expenditures were pegged at C37.5 million.
The Lockerby mine has indicated resources of 1.84 million tonnes graving 2.33% Ni, 1.44% Cu and 0.086% Co (2.84% NiEq). The inferred resources total 580,000 tonnes at 1.88% Ni, 1.10% Cu and 0.065% Co (2.26% NiEq).
The Lockerby Depth zone will be developed using a new transverse accessed blasthole stope design for production at a rate of 800 t/d. The zone's probable reserves are 1.44 million tonnes at 2.23% Ni, 1.36% Cu and 0.083% Co (2.71% NiEq).
The company will issue over 208 million units at a price of $0.12 each. Each unit consists of one First Nickel share and one-half of a common share purchase warrant.
Additional information is available at www.FirstNickel.com.