Premium Nickel exceeds BCL revival target by P120m
Lewanika Timothy | Tuesday June 18, 2024 10:04
The Canadian firm executives revealed in a statement recently that the capital raise was conducted through a private financial instrument where current investors are offered shares at a fixed rate. The above market expectation performance signals confidence for the copper market and hopes for the reopening of the BCL Mine.
“Premium Nickel Resources Ltd is pleased to announce that the company is upsizing its previously-announced non-brokered private placement offering of units of the company at a price of $0.78 per unit from approximately C$15 million to aggregate gross proceeds of up to approximately C$27.5 million, in response to very strong interest in the Offering, largely from the Company's existing shareholders. The company has received committed subscriptions for the entire C$27.5 million,” company executives revealed.
Proceeds from the capital raise round are expected to be channelled towards resuscitating the BCL Mine operations, which have been mothballed since the mine's shutdown in 2016 when a steep downturn in metal prices forced the closure of the asset.
“The net proceeds of the offering will be used by the company to advance the exploration and development of its mineral assets in Botswana and for general corporate and working capital purposes,” officials stated.
PNRL directors previously disclosed that investing will include redeveloping the mines through modernisation and implementation of mining best practices to improve safety and efficiency, reduce power consumption, adopt alternative energy sources, and minimise water usage.
PNRB, led by former BCL Mine boss, Montwedi Mphathi, snapped up the Selebi and Selebi North shafts, as well as Selkirk Mine from government, in a deal pegged at P837 million last year. The transaction includes related infrastructure such as rail, power, and water works, and a pledge to spend P5 billion in reviving the assets that have been mothballed since 2016.
The alpha market performance of the PNRL capital raise round is tailwinded by bullish demand for copper as a critical mineral for the world’s transition towards greener technologies. Bank of Botswana Economic and Financial Statistics Report (BEFS) released recently shows that in the first two months of this year, copper sales stood at over P1.5 billion exceeding last year’s first quarter performance, which was at a cumulative P1.4 billion.