The ASX's next nickel producer secures $2.5 million to advance a second project

Pacific Nickel Mines (ASX: PNM) successfully raised $2.5 million to advance a second nickel deposit – the Jejevo Project – located in the Solomon Islands. 

“The new equity funds will assist the Company to continue studies and work at the Company’s Jejevo Nickel Project where a mining lease application has already been lodged,” said CEO Geoff Hiller.

“A preliminary Scoping Study prepared in support of the application demonstrated that Jejevo could be advanced in a similar way as the Kolosori Nickel Project,” he added.

Earlier this month, the company received the formal backing of mining giant Glencore for a loan facility of up to US$22 million to bring its flagship Kolosori Nickel Project into production.

A ‘Copy and Paste’ of Kolosori 

Pacific Nickel Mines acquired the flagship Kolosori Nickel Project in May 2021 and is now expected to hit production status in the December quarter 2023. The Project has a post-tax NPV of US$64 million under a base case scenario, producing up to 1.5 million wet metric tonnes of direct shipping ore.

Both projects possess a similar Mineral Resource, with Jejevo containing 7.82 million tonnes of nickel at grades of 1.46% while Kolosori possesses 7.08 million tonnes at 1.57%. Further drilling has been planned for both projects to further upgrades inferred resources and test extensions.

To add some perspective about Kolosori’s path to production:

• May 2021: Acquires 80% of Kolosori

• June 2021: Drilling commences 

• October 2021: Stage 2 drilling commences 

• November 2021: Scoping study completed

• January 2022: Early works in progress

• June 2022: Offtake and debt mandate awarded to Glencore

• September 2022: Mining lease awarded

• September 2022: Updated JORC Resource Estimate

• February 2023: Definitive Feasibility Study completed

• March 2023: Export permit granted

• April 2023: Glencore executes finance and offtake agreement 

The preliminary Scoping Study showed that Jejevo was a “look-alike” for the Kolosori Project and is currently waiting on development approvals. 

“I look forward to updating the market as we advance Kolosori to production this year and simultaneously progress the necessary steps to commence development activities at Jejevo,” said Hiller. 

DISCLAIMER: Market Index helps small-cap ASX listed companies connect with Australian investors through clear and concise articles on key developments. Pacific Nickel Mines was a client at the time of publishing. All coverage contains factual information only and should not be interpreted as an opinion or financial advice.