Medallion Metals Ltd (ASX:MM8) has begun the process to divest its nickel tenure at Ravensthorpe, with new company NickelSearch set to debut on the ASX in early October.
The company is an advanced high-grade gold and copper explorer in Western Australia, with its flagship Ravensthorpe project sitting 550 kilometres southeast of Perth.
As well as gold and copper, Ravensthorpe contains a number of tenements prospective for nickel and those tenements will form the Carlingup Nickel Project, which will be NickelSearch’s flagship asset.
Nickel divestment a win-win
Speaking to shareholders in May this year, when the divestment was first announced, Medallion managing director Paul Bennett said the deal secured a “great outcome” for investors.
“The prospective nickel ultramafics east of Ravensthorpe are often overlooked, and we’re pleased to be working to consolidate the tenure and bring investment to bear on an area proven to host high-grade nickel sulphides,” he said.
“In addition to maximising the value of the ultramafics for Medallion shareholders, this transaction will further sharpen our focus on the gold and copper at Ravensthorpe.
“We will continue to keep shareholders informed of transaction milestones and NickelSearch’s progress toward listing on the ASX and becoming a new Western Australian nickel explorer with assets in a proven and highly prospective nickel terrain.”
As part of the arrangement, Bennett has been appointed to the NickelSearch board as a non-executive director and Medallion will maintain the right to one nominee board position until its shareholding in NickelSearch falls below 10%.
NickelSearch listing details
NickelSearch is aiming to raise up to $10 million in its initial public offer, issuing as many as 50 million shares at 20 cents a pop.
NickelSearch, which is expected to list under the code NIS on October 6, would have an indicative market cap of $20.8 million if the offer is fully subscribed.
Some 15.7 million shares will be issued to Medallion. Should NickelSearch raise the full $10 million, Medallion would have a shareholding of 15.1%.
Carlingup project
The consolidated Carlingup tenure will straddle a large portion of both the eastern and western limbs of the Bandalup ultramafic belt.
This area was the subject of extensive nickel sulphide exploration activities by Western Mining Corporation and Pickands Mather International during the 1960s and 70s when the RAV series of deposits were delineated.
The RAV8 deposit was the only one of the RAV prospects commercialised, producing 458,871 tonnes at 3.46% nickel for 15,865 tonnes of contained nickel metal between 2000 and 2007.
These deposits contain shallow mineralisation open in most directions with an inferred resource at RAV8 of 13.2 million tonnes at 0.6% nickel for 75,100 tonnes of nickel and a combined exploration target at RAV1, RAV4 and RAV4 West of 300,000 tonnes at 0.9% nickel for 2,800 tonnes of nickel to 9.8 million tonnes at 0.4% nickel for 41,200 tonnes of nickel.
Outlining the company’s objective for Carlingup, NickelSearch chairman David Royle said the company was primed to tap into the area’s nickel potential.
“Despite the long history of exploration for nickel in the Carlingup area, apart from the known shallow sulphide deposits, there has been remarkably little deep drilling below 100 metres elsewhere targeted at the prospective basal ultramafic contact,” he said.
“Recent targeting, based mainly on coincident structural and geochemical data, has highlighted several target areas north of RAV8 that give significant opportunity for further nickel sulphide discoveries.”
Carlingup priorities
NickelSearch’s priorities for Carlingup are:
- The discovery of high-grade nickel sulphides like the high grade shoots mined at RAV8 under shallow cover employing high-tech modern exploration techniques;
- Advancing existing near-mine exploration targets to new mineral resource estimates capable of expanding the company’s current resource base;
- Increasing the size of and improving the confidence in the existing near-surface sulphide resource base;
- Undertaking metallurgical test-work on the promising low-cost and green bio-leach treatment process for nickel sulphides; and
- Seeking organic growth opportunities through regional exploration targeting of greenstone belts in the Yilgarn Craton for nickel.
- Daniel Paproth