Canadian firm raises $1.37M for nickel project in Surigao

Mindoro Resources Ltd. has raised a total of $1.37 million (P59.85 million) for its Agata nickel project through private placement despite “difficult market conditions” and noted strong interest from potential partners. The Agata nickel project in the Surigao nickel district in Mindanao has an expected mine life of 20 years.

Company president and CEO Jon Dugdale said Mindoro Resources raised $175,978 (P7.7 million) in the second closing of its private placement, which was previously announced on Nov. 22, 2011. The private placement will close on Jan. 24, 2012.

The private placement is being offered as common shares in Canada and as Chess Depository Interests (CDIs) in Australia, the Canadian miner said.

Mindoro Resources is set to hold a special shareholders’ meeting on March 8 in Calgary, Alberta, in Canada to seek shareholder approval to allow company directors to participate in the private placement and to expand the company’s capacity to offer shares.

Mindoro Resources said full details of such matters, including the proposed resolutions, would be distributed to shareholders.

The company has issued 1.54 million common shares and CDIs to qualified investors in connection with the second closing. CDIs have been issued to investors in Australia, with the underlying common shares deposited with the Chess Depository.

While raising funds, Mindoro Resources is also seeking a strategic financing partner for a two-stage development strategy for Agata.

A number of parties, mostly from the Asian region, have expressed strong interest in financing the development of the Agata nickel project. These parties were now conducting assessments before finalizing preliminary proposals, Dugdale said.

The company is working with its financial advisor, Deloitte Corporate Finance Pty. Ltd., to advance discussions and negotiations during the first quarter of 2012.

Dugdale said the strong interest in Agata highlighted the strategic advantages that the project possessed. These included its location on a protected coast-line, with no forest or significant population on the resource, and outstanding metallurgical characteristics for both thermal and hydrometallurgical processing, Dugdale said.