(All amounts expressed in Canadian dollars unless otherwise indicated)
TORONTO, May 10, 2013 /CNW/ - Royal Nickel Corporation (TSX: RNX)
("RNC") is pleased to report its review of activities and financial
results for the quarter ended March 31, 2013. All amounts are expressed
in Canadian dollars, unless otherwise noted, and are based on the
unaudited condensed interim financial statements for the three months
ended March 31, 2013.
Tyler Mitchelson, President and CEO, commented, "Yesterday, we signed a
US$15 million royalty financing with Red Kite, a leading global mining
investor. This is an important additional step in the financing process
and a significant endorsement of the Dumont project. I am also pleased
with the progress made by RNC's technical teams as we continue to focus
on the delivery of a feasibility study and support work for the
permitting process with respect to the Dumont project. We remain on
track to complete the feasibility study by the middle of this year and
continue to expect we will receive the required permits for Dumont
during the second quarter of 2014. At the corporate level, our focus is
on continued discussions with potential partners aimed at entering into
a development financing arrangement in advance of the completion of the
permitting process."
First Quarter and recent Highlights
-
On May 9, 2013, RNC signed a royalty purchase agreement with RK Mine
Finance ("Red Kite"). Under the terms of the agreement, Red Kite will
acquire a 1% Net Smelter Return ("NSR") Royalty in the Dumont Nickel
Project for a purchase price of US$15 million. Closing is expected by
the end of today.
-
On March 12, 2013, RNC announced that it had signed a memorandum of
understanding ("MOU") with Tsingshan Holding Group Co., Ltd. The MOU
sets out the objectives of the parties to work together in relation to
downstream concentrate processing and the potential to enter into an
offtake and/or partnership arrangement. Tsingshan is the second largest
Chinese stainless steel company and one of the leading innovators in
the development of vertically integrated nickel pig iron and stainless
steel production operations.
-
On April 5, 2013, RNC announced the signing of a memorandum of
understanding with the Abitibiwinni First Nation with respect to the
Dumont Nickel Project.
-
On March 7, 2013, RNC announced that it had closed a private placement
of 4 million flow-through shares at a price of $0.50 per share for
gross proceeds of $2 million.
-
On January 18, 2013, RNC announced the official opening of its new
community liaison office located in the municipality of Launay in the
Abitibi region of Quebec.
-
RNC incurred a net loss of $1.8 million for the three months ended March
31, 2013 compared to a net loss of $2.5 million for the same period in
2012.
For the three months ended March 31, 2013, RNC incurred a net loss of
$1.8 million ($0.02 per share) compared to a net loss of $2.5 million
($0.03 per share) in the same period last year. The net loss decrease
of $0.7 million is due primarily to lower general and administrative
expenses of $0.9 million. The decrease in general and administrative
expenses is due primarily to lower consulting fees of $0.4 million,
lower share-based payments expense of $0.1 million and lower salaries,
wages and benefits of $0.1 million.
Targeted Future Milestones
-
Completion of an NI 43-101 feasibility study technical report by
mid-2013
-
Completion of partnership and financing arrangements in advance of the
receipt of permits
-
Potential placement of long-lead orders driven by the project schedule
and market-driven equipment lead times
-
Receipt of permits in the second quarter of 2014
-
Start of construction following receipt of permits in 2014
-
Project commissioning in late 2015 and production ramp-up in 2016
Highlights of RNC's financial position are as follows (in millions of dollars):
|
|
|
|
| March 31, 2013 |
| December 31, 2012 |
Cash position1 |
7.4
|
|
10.8
|
Working capital2 |
13.1
|
|
15.4
|
Tax credits receivable3 |
10.1
|
|
9.7
|
Total assets
|
80.3
|
|
79.0
|
Shareholder's equity
|
67.4
|
|
68.0
|
1 |
Includes Cash and Cash equivalents.
|
2 |
Working capital is a measure of current assets less current liabilities
|
3 |
Current portion of tax credits receivable is $9.6 million (2012: $7.3
million) and non-current portion is $0.5 million (2012: $2.4 million)
|
About Royal Nickel Corporation
Royal Nickel Corporation is a mineral resource company focused primarily
on the exploration, evaluation, development and acquisition of base
metal and platinum group metal properties. RNC's principal asset is the
Dumont Nickel Project strategically located in the established Abitibi
mining camp, 25 kilometres northwest of Amos, Quebec. RNC has a strong
management team and Board with over 100 years of mining experience in
the nickel business at Inco and Falconbridge. RNC's common shares trade
on the TSX under the symbol RNX.
Cautionary Statement Concerning Forward-Looking Statements
This news release contains "forward-looking information" including
without limitation statements relating to key milestones for 2013 and
2014.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of RNC to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking statements. Until a positive feasibility study has been
completed, and even with the completion of a positive feasibility
study, there are no assurances that Dumont will be placed into
production. Factors that could affect the outcome include, among
others: the actual results of development activities; project delays;
inability to raise the funds necessary to achieve the milestones or
complete development; general business, economic, competitive,
political and social uncertainties; future prices of metals;
availability of alternative nickel sources or substitutes; actual
nickel recovery; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; accidents, labour
disputes and other risks of the mining industry; political instability,
terrorism, insurrection or war; delays in obtaining governmental
approvals, necessary permitting or in the completion of development or
construction activities. For a more detailed discussion of such risks
and other factors that could cause actual results to differ materially
from those expressed or implied by such forward-looking statements,
refer to RNC's filings with Canadian securities regulators available on
SEDAR at www.sedar.com.
Although RNC has attempted to identify important factors that could
cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results to differ from those anticipated,
estimated or intended. Forward-looking statements contained herein are
made as of the date of this news release and RNC disclaims any
obligation to update any forward-looking statements, whether as a
result of new information, future events or results or otherwise,
except as required by applicable securities laws.
SOURCE: Royal Nickel Corporation
<p> Rob Buchanan<br/> Director, Investor Relations<br/> T: (416) 363-0649<br/> <a href="http://www.royalnickel.com">www.royalnickel.com</a> </p> <br/> <p> Mélanie Corriveau (French contact)<br/> Community Relations Coordinator<br/> T: (819) 727-3777 </p>