TIDMRGM
RNS Number : 0143X
Regency Mines PLC
30 November 2010
Regency Mines PLC
('Regency', 'Regency Mines' or the 'Company')
Update on Mambare and Direct Nickel Pty Ltd
30 November 2010
Regency Mines, the mining exploration and mineral investment
company with interests in nickel and other minerals in Western
Australia, Queensland, Papua New Guinea and Pakistan, announced on
19 November 2010 that it had entered into an agreement whereby the
Company was to invest in Direct Nickel Pty Ltd ("DNi"), and the two
parties would, pursuant to their joint venture, jointly finance the
next stage of exploration at Regency's Mambare lateritic
nickel/cobalt project in Papua new Guinea.
Direct Nickel Pty Ltd and the Direct Nickel Process
DNi is a private company incorporated in Australia. It is
currently demonstrating a potentially revolutionary process with
attractive economics for treating laterite nickel ores (the "Direct
Nickel Process" or the "Process").
The Direct Nickel Process is a hydrometallurgical process for
treating nickel laterites with unprecedented efficiency and
environmental benefits. It is designed to operate with tank
leaching at atmospheric pressure, and is the first to treat both
limonite and saprolite ores with a single flowsheet. The Process
recycles its novel reagents, offers high cobalt and nickel
recoveries with short residence time, produces mixed hydroxide
precipitates ("MHP") or sulphide concentrate, has substantially
lower capital and operating costs than competing processes and is
fully scalable.
DNi owns the worldwide perpetual rights to the Process which it
developed from precursor processes originally developed in the
chemical processing sector in the USA. DNi has spent more than USD
14m over the past three years on proving the Process, partly
through technical partnership with its shareholder and major
Canadian miner Teck Resources Limited.
The Direct Nickel Process has the potential to revolutionise the
economics of global nickel production.
Direct Nickel Pty Ltd and Regency Mines plc
DNi and Regency first announced a joint venture co-operation on
6 November 2009 with a commitment to pilot and apply DNi's advanced
nickel-cobalt extraction technology.
Regency Mines has now subscribed AUD 3,000,000 (approximately
GBP1,852 520) for a first tranche of 519,930 new shares in DNi at
AUD 5.77 per share ("First Tranche") and will subscribe AUD
3,000,000 for a further tranche of 519,930 new DNi shares on 19
December 2010. The First Tranche is being settled by the issue of
26,841,114 new Regency shares at a price of 6.9018 pence per share.
DNi currently has 13,192,029 shares in issue and, on completion of
the second tranche, Regency will have a shareholding equivalent to
approximately 7.31% of DNi's enlarged issued share capital. The
subscriptions attribute a valuation to DNi of approximately USD
75,000,000, the same basis as an investment by the Commonwealth
Scientific and Industrial Research Organisation ("CSIRO"),
Australia's national science agency, in June 2010.
Next steps
The Direct Nickel Process reagent recycling circuit
demonstration was completed in August 2010 at its facility in
Charlotte, North Carolina, and DNi is now in the final design phase
for the building of a Demonstration Plant at Waterford, Perth.
A joint technical team of DNi and the CSIRO will build a Direct
Nickel Process prototype facility to process one to five tonnes a
day of ore from various deposits in which DNi has equity
participation.
Regency and DNi have agreed that they will each contribute up to
GBP1 000,000 to the next phases of exploration at Mambare which is
planned to commence in January 2011 with the twin objectives of
drilling out a resource and testing further areas of
mineralisation.
Other
In its unaudited results for the year to 30 June 2010, DNi made
Pre-Tax Losses of AUD 4,795,221 and had Net Assets of AUD 1,067,204
at that date.
As shareholder in Direct Nickel, Regency joins Canadian miner
Teck Resources Limited, Australian copper-gold company OZ Minerals,
and the CSIRO.
Regency considers this investment an important step, both in
furthering its strategic alliance and co-operation with DNi, and in
allowing it to become a significant shareholder at an early stage
in a mining technology that may change the nickel processing
industry.
Application will be made for the 26,841,114 new Regency shares,
which rank pari passu with the Company's existing issued ordinary
shares, to be admitted to trading on AIM. It is expected that
admission will become effective and that trading will commence on 3
December 2010. Following the issue of the new Ordinary Shares the
Company's enlarged issued ordinary share capital will be
534,192,891 Ordinary Shares.
For further information contact:
Regency Mines PLC Andrew Bell, Chairman 0207 402 4580
Sandra Spencer, Public and
Investor Relations 0207 402 4580
Nominated Adviser
Religare Capital Markets Peter Trevelyan-Clark/Ben Jeynes 020
7444 0800
Broker
Simple Investments Ltd Nick Emerson 01483 413500
Updates on the Company's activities are regularly posted on its
website www.regency-mines.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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