The bank bought more than 16 million shares after the nickel group published interim results last week and now holds a stake of 6.19 per cent described as beneficial.

ENK is developing the Acoje nickel mine in the Philippines. Once up and running it is expected to produce 24,500 tonnes of nickel and 930 tonnes of cobalt a year. At the moment the Acoje has a 10 year mine life.

ENK is also in a strong cash position following the sale of the Caldag prospect in Turkey earlier in the year.

Last month, managing director Rob Gregory said "The receipt of the additional US$34 million [from the Caldag sale] means that ENK now has over US$40 million cash on hand”.

“The company is fully funded for its ongoing BFS activities at its Acoje project in the Philippines and will have a significantly strengthened balance sheet ahead of negotiations with project finance providers.  This will enable the company to remain on track to commence production at Acoje in 2013," he added.

Shares in ENK ticked up slightly to 12.25p on today’s news, which values the AIM-listed group at £32 million.

In the group’s interim statement today Rowe said he hopes to announce a new JORC resource for Acoje soon, along with new economics for the project. 

The key BFS is also on track for completion in the second quarter of 2012, he added. The firm plans to start building work on the site soon after the BFS is complete.

Earlier this week the company announced that test work on its Acoje mining inventory had shown superior recoveries and economics from tank leaching as opposed to heap leaching. 

The company added it will now only take the tank leaching option forward into the Bankable Feasibility Study due for completion at the end of the second quarter of 2012.

Managing director Robert Gregory said "Not only does tank leaching offer superior economics, it is an inherently less risky option compared to heap leaching in a high rainfall environment. 

“Tank leaching also lends itself to a staged construction approach offering a reduction in initial capital costs and its associated financing. It is for these reasons that we have elected to utilise tank leaching for the BFS."

Meanwhile it said that infill drilling of the resource at Acoje is also now complete and drilling at the Zambales Chromite tenement is approximately 25% complete

Additionally ENK today said that it has now begun the process of selling non-core assets. And it has already entered into agreements for the sale of some copper-gold tenements that were previously owned by Rusina Mining.

The company added it will now only take the tank leaching option forward into the Bankable Feasibility Study due for completion at the end of the second quarter of 2012.

Managing director Robert Gregory said "Not only does tank leaching offer superior economics, it is an inherently less risky option compared to heap leaching in a high rainfall environment. Tank leaching also lends itself to a staged construction approach offering a reduction in initial capital costs and its associated financing. It is for these reasons that we have elected to utilise tank leaching for the BFS."

Infill drilling of the resource at Acoje is also now complete and drilling at the Zambales Chromite tenement is approximately 25% complete, ENK said  Both resource updates will be incorporated into the BFS.

Using tank leaching, recoveries of nickel and cobalt over a three stage leaching circuit averaged 92% and 97% respectively over a 22 hour leach period. 

Based on the average diluted grades of the Acoje mining inventory, an implied cash cost of US$2.93 per pound of nickel produced, net of by products, was calculated. 

Assuming a nickel price of US$7.00 per pound (US$15,430/ tonne) and 80% payability, a notional refining charge of US$1.40 needs to be added for a total cash cost to nickel metal of US$4.33 per pound.

ENK added it also took a very conservative view of the cost of sulphuric acid, which will represent 62% of the total operating costs. 

ENK’s Acoje and Zambales deposits are based on Luzon Island in the Philippines.  The deposits have a combined JORC resource of 840,000 contained tonnes of nickel.

The ZCMC is located near the group’s flagship Acoje nickel mine development project.

The project currently has a JORC inferred resource of 23.5 million tonnes of nickel laterite ore at a grade of 1.18 per cent nickel and 0.05 per cent cobalt. ENK has a 40 per cent stake in the venture. 

With a 3,000 metre drill programme ENK and its partner Montemina Resources Corporation plans to upgrade the current JORC resource estimate.

It is expected that 255 holes will be drilled in the programme. 

ENK said it anticipates that the drilling program will continue until the end of the first quarter of next year. 

In a separate statement earlier today ENK told investors that it has received the outstanding US$34 million from the sale of the Caldag project.

The Acoje nickel project’s bankable feasibility study is now fully funded, it said.

Caldag had previously been a key focus for ENK, however delays in the permitting process led to the mothballing of the Turkish project.

The group announced the agreement to sell Caldag for US$40 million in mid-September and received a deposit of US$6 million shortly after.  

Now ENK is firmly focused on the Acoje project.  This mine development project is located in the Philippines and it is scheduled for first production in 2013.

Once up and running Acoje is expected to produce 24,500 tonnes of contained nickel and 930 tonnes of contained cobalt a year. At the moment the Acoje has a 10 year mine life however, according to ENK, the current resource drill programme should significantly lengthen the life of mine.

"The receipt of the additional US$34 million means that ENK now has over US$40 million cash on hand,” said managing director Rob Gregory.

“The company is fully funded for its ongoing BFS activities at its Acoje project in the Philippines and will have a significantly strengthened balance sheet ahead of negotiations with project finance providers. 

“This will enable the company to remain on track to commence production at Acoje in 2013."

The Acoje nickel project’s bankable feasibility study is now fully funded, it said.

Caldag had previously been a key focus for ENK, however delays in the permitting process led to the mothballing of the Turkish project.

The group announced the agreement to sell Caldag for US$40 million in mid-September and received a deposit of US$6 million shortly after.  

Now ENK is firmly focused on the Acoje project.  This mine development project is located in the Philippines and it is scheduled for first production in 2013.

Once up and running Acoje is expected to produce 24,500 tonnes of contained nickel and 930 tonnes of contained cobalt a year. At the moment the Acoje has a 10 year mine life however, according to ENK, the current resource drill programme should significantly lengthen the life of mine.

"The receipt of the additional US$34 million means that ENK now has over US$40 million cash on hand,” said managing director Rob Gregory.

“The company is fully funded for its ongoing BFS activities at its Acoje project in the Philippines and will have a significantly strengthened balance sheet ahead of negotiations with project finance providers. 

“This will enable the company to remain on track to commence production at Acoje in 2013."

In Turkey, the former main project Caldag was put on care and maintenance in December 2010 after the company experienced persistent delays in getting a forestry permit. Following a strategic review at that time ENK - formerly known as European Nickel – refocused its efforts on the Acoje project.

Recent on-site progress has strengthened the investment case, as has the agreed sale of the Turkish Caldag property for US$40 million which should close on or before November 15, according to the broker in today's note.

“With no shortage of cash with which to complete its Acoje work, we strongly reiterate our 50 pence target price and our Buy recommendation,” Evolution said. ENK is currently trading at 14.6 pence.

At the end of October, ENK achieved first nickel production at its Acoje pilot heap leach plant.

In delivering this nickel hydroxide product, the company will be able to commence conversations with potential off-take partners which will be able to evaluate the product. This would clearly be an important step in the group’s future quest to secure financing for its project post-DFS, which remains on track for completion in the second quarter of next year.  

“While the pre-feasibility study for Acoje delivered robust results on just a 10 year mine life, the recently completed drilling programme on the Acoje inferred resources should enable the group to increase the confidence category of this resource, thereby allowing it to be included in mine plans,” the broker said.

“This, in conjunction with proposed drilling of the Zambales resource, could increase the mine life of a combined operation to in excess of 20 years,” it added.

Nickel miner ENK (LON:ENK, ASX:ENK) announced today that first nickel production at its Philippines pilot plant has begun.

Approximately 50 kilograms of nickel hydroxide product (NHP) was released from the plant’s filter press yesterday, the firm said. Final assay results are described as “outstanding”, and initial assays of the NHP at bench-top level have contained approximately 49 per cent nickel and four per cent iron.

ENK said that the plant can produce approximately 200 kilograms of NHP per month by using ion exchange for nickel-cobalt separation and purification to process a pregnant leach solution from the heap leach trial pad, followed by precipitation of the nickel as NHP.

The initial NHP will be sent to potential customers for evaluation. NHP has wider market appeal than the MHP (missed hydroxide product) that was previously produced at the company’s Caldag project in Turkey since it has significantly lower metal impurities.

Meanwhile, ENK said that the Acoje bankable feasibility study (BFS) for an atmospheric nickel leaching project remains on track for completion in the second quarter of next year. The firm said that the infill drilling programme at Acoje was completed on October 21 and a new updated resource estimate for this tenement will be announced in due course. The drill rigs are currently in the process of relocating to the Zambales Chromite tenement five kilometres north of Acoje, where they will embark on a 255-hole programme, estimated to be completed early next year.

“It is a magnificent effort by the Acoje team to go from being on care and maintenance last year to building and commissioning the pilot plant ten months later,” said Robert Gregory, ENK’s managing director.

ENK Plc (LON:ENK, ASX:ENK) is set for a US$40 million cash boost as it has agreed to sell the Caldag nickel project, which has been on care and maintenance since last December, to a private Turkish firm.

The cash injection means that ENK will be able to take its Philippines nickel project, Acoje, through to bankable feasibility without seeking additional funding from shareholders. 

Caldag was previously ENK’s – under its old moniker European Nickel - priority projects however its progress stalled due to persistent delays in getting a forestry permit. Since Caldag was put on care and maintenance last year the group has refocused its efforts on the development of the Acoje project.  

A US$6 million deposit will be paid to ENK by 13:00 tomorrow and the remaining US$36 million will be paid upon closing the deal – which may be subject to shareholder approval.

"This transaction brings immediate value to shareholders and removes the costs associated with keeping Caldag on care and maintenance,” said managing director Rob Gregory.

“The sale outcome will provide the funds required, without the need to raise additional equity, to allow ENK to complete the Bankable Feasibility Study on its Acoje nickel laterite project in the Philippines which is targeting first production in 2013."

Importantly ENK confirmed that the US$40 million proceeds will fully fund the bankable feasibility study at Acoje. The study is currently on-track for completion in mid-2012.

Once up and running Acoje is expected to produce 24,500 tonnes of contained nickel and 930 tonnes of contained cobalt a year. At the moment the Acoje has a 10 year mine life however, according to ENK, the current resource drill programme should significantly lengthen the life of mine.

The proceeds, which equates to around £25 million (9.6 pence a share) , represent more than half the group’s current market value of £37 million, or 14.25 pence a share.

ENK also confirmed that Caldag had a net book value of US$50 million.

This compares with US$10.91 million at the start of period, though the company’s direct shipments from its Acoje project in the Philippines should help to mitigate the cash burn.

Two shipments of nickel laterite have so far been made and a third is “imminent”, ENK said.

At the same time the resource drilling campaign at Acoje is making progress. 

So far 22 holes for 219 metres have been drilled out of a total of 124 holes, which will cover 1,736 metres. 

The programme is still on target to be completed by the end of September, at which point the rig moves to Zambales Chromite Mining Corporation (ZCMC) to begin 3,300 metre campaign.  

“The company remains on track to extend the ten year mine life by converting the JORC inferred resources at Acoje and ZCMC to JORC indicated status,” the company said this morning. 

“There is also an opportunity to add presently undrilled ore to the resource including the untested saprolite horizon of the ZCMC tenement.”

As previously announced China Tianchen Engineering Corporation has been appointed as the engineering consultant responsible for the implementation of the bankable feasibility study on Acoje.

“The process of identifying principal consultants is well underway and work has commenced in a number of areas,” ENK added.

“The study should be complete by the middle of 2012. The actual BFS will be conducted in parallel with remaining test work being undertaken at the HLT and the ATC.”

The Acoje heap leaching trial, which has been under irrigation for more than three months now, “continues to run on schedule”, the European Nickel added.

European Nickel (LON:ENK, ASX:ENK) said it is encouraged by the progress that has been made on the technology front at the test centre of the Acoje project in the Philippines and believes it will be making announcements about this in the near future.

Last December, the company shifted its focus from the Caldag project in Turkey to its Acoje asset. It placed Caldag on care on maintenance as it decided to wait no more for the government to sign off a crucial forestry permit, and decided instead to fast-track Acoje.

In today’s results statement covering the 18 months to March 31 2011, ENK said it is considering all options regarding Caldag, including an outright sale, part sale or joint venture of the project. It is also reviewing the overall project footprint in order to present a more environmentally, socially and politically acceptable project. The most appropriate way to move forward should become clearer over the next few months.

As of the date of this report the trial heap leach project at Acoje has been under irrigation with acid for more than two months. The rain mitigating measures are performing excellently with several high event rainfalls occurring at site.

The laterite heap has maintained its structure and acid is freely percolating through the heap. In addition the bankable feasibility study team based in Manila is now complete, resource drilling at the Acoje tenement has commenced, and tender of the feasibility study manager's role has closed with bids in the assessment stage.

Chairman David Whitehead said: “The current cash position of the company is satisfactory and we are not planning to raise further capital from our shareholders in order to complete the Acoje BFS.

“The company expects that it will fund its working capital requirements from the sale of nickel laterite ore through a direct ore shipping contract at Acoje (with strategic partner DMCI Mining). The first shipment is imminent. In addition we have commenced the sale of surplus assets and have already signed contracts for the sale of the Barlo and Abogado properties in the Philippines,” he added.

Broker Evolution Securities reiterated its "buy" recommendation for the stock and targeted a price of 55 pence.

Analyst Louise Collinge said the firm's profit and loss statement
reflected the  the two key events during the reporting period - namley the exceptional gain related to the merger with Rusina Mining and the impairment of the Caldag project in Turkey.

"Importantly, the company has over US$10million in cash and is now generating cash from its DSO (direct shipping ore) operations. In his statement, the chairman refers to the cash position as satisfactory and states that the company does not plan to raise further capital in order to complete the Acoje feasibility study, which we view as very good news."

European Nickel (LON:ENK) has been receiving increased interest from a mysterious investor known as Montoya Investment Limited. Today, the firm announced Montoya had bought a further 2.4 million shares to raise its holding in European Nickel to almost 31.8 million shares.

European Nickel’s share price was up almost 13.15 per cent at 20.65 pence as of 15:27pm. 

This latest acquisition is Montoya’s fourth purchase of shares in European Nickel this month, bringing the investor’s stake in the firm from 8.3 per cent to 12.1 per cent.

Little is known about Montoya, which first came to the notice of European Nickel investors when it announced it held 5.76 per cent of the company’s share in March this year after buying almost six million shares in the firm. But whoever is behind the investment vehicle also appears to be currently interested in precious coins and high technology.

Also in March, Montoya raised its stake in specialist investment company Avarae Global Coins (LON: AVR) to 25.8 per cent after having held around 12 per cent of the business in December. Montoya also holds significant stakes in gas cylinder and biogas group Pressure Technologies (LON: PRES) and high tech engineering group Elektron (LON:EKT).

Shares in European Nickel fell from 35 pence each in December last year to below 14 pence earlier this month as a result of the firm deciding to put its flagship nickel project in Çaldağ, Turkey, on care and maintenance. Since then, the firm has focused on its Acoje laterite nickel project in the Philippines.