ORION Minerals has extended the deadline on a deal to consolidate the ownership of its Jacomynspan Nickel-Copper-PGE Project, located 65km north of its Prieska Copper-Zinc-Project in SA.
According to the Australian company that bought South Africa’s historic O’Kiep Copper Complex in the Northern Cape, the deadline was extended from February 27 to April 30.
"The extension provides additional time for the parties to discuss a potential expanded and revised transaction whereby additional prospective Southern African nickel projects will be combined with the Jacomynspan Project," the company said.
The Jacomynspan Project is situated on the Namaqua and Disawell companies’ mining and prospecting rights, and contains a JORC-compliant, intrusive-hosted, sulphide nickel-copper-platinum group metal resource.
"This stands at 6.8 million tonnes of ore, comprising 39 000 tonnes of nickel, 22 000 tonnes of copper and 1 800 tonnes of cobalt, drilled between 1971 and 2012," the company said.
The mineral resource remained open along strike and down-dip, presenting a compelling exploration opportunity, Orion said.
Since the deadline had been extended, and if the parties are able to conclude a deal successfully, the final completion date would automatically be further extended to September 30, during which time the parties would have to formalise a written agreement.
"If the parties are unable to enter into an initial agreement on or before April 30, the deal will lapse," the company said.
The deal came about when, in 2017, Orion entered into a binding earn-in agreement to acquire the earn-in rights over the Jacomynspan Project from two companies, Namaqua Nickel Mining, and Disawell.
Three years later, the company announced it had entered into an agreement where Orion would acquire the remaining shares in the Namaqua Disawell Companies held by the other shareholders in the Namaqua Disawell Companies.
"The transaction was designed to simplify the ownership and management structure of the Jacomynspan Project," it said.
On August 31, 2020, the parties entered into a comprehensive formal written agreement incorporating the principal terms and conditions set out in the initial agreement.
Since finalising the earn-in agreement, Orion has advanced exploration programmes on the Jacomynspan Project, with expenditure held in a shareholder loan account.
"The company is now entitled to a total interest of 50 percent in the Jacomynspan Project, subject to some regulatory approvals," it said.
Orion is the manager and operator of the joint venture. The company's earn-in is held via its wholly-owned subsidiary, Areachap Investments, and its South African subsidiary, Area Metals Holdings.
Nickel is a hot commodity right now. Russia’s invasion of Ukraine has fuelled supply crunch fears on top of low stocks.
Bloomberg reported that on Friday, nickel futures jumped sharply in London to trade above $30 000 (R461 040) a ton for the first time since 2008, as surging prices created a short squeeze in an already tight market.
Nickel rose as much as 13 percent to $30 295 a ton before settling at $28 919 on the London Metal Exchange on Friday. The metal surged 19 percent this week for the biggest weekly jump since 2009.
Orion also released its interim financial report for the period ended December 31, 2021, on Friday.
Its operating profit slid to a loss of A$10.47 million (R119m) from an operating profit of A$0.1m, driven by an unrealised foreign exchange loss of A$5.2m and exploration expenditure incurred of A$4.3m. Its headline loss per share (heps) decreased by 25 Australian cents, from 2 Australian cents in 2020.
The company said it continued to progress in its strategy of building the next significant base metals producer, advancing financing and pre-development activities at the development-ready Prieska Copper-Zinc Project, while also exercising its option to acquire a controlling interest in several properties within the Okiep Copper Project (OCP), where exploration programs and feasibility studies were now under way.
"The OCP presents a significant growth opportunity, with the potential to become a second base metal production hub for Orion. Both the Prieska Project and the OCP are located in the mineral-rich Northern Cape province of South Africa," Orion said.
The company said subsequent to reporting period end, it has commenced investigations into bringing forward the start of production from the Prieska Project through re-scheduling of the open-pit mining to occur during the development phase of the Deeps Mine.
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