Blackstone Minerals Ltd (ASX:BSX, OTCQX:BLSTF) has made a strategic investment in fellow nickel-copper-cobalt sulphide exploration and development company Corazon Mining Ltd (ASX:CZN).
Blackstone’s initial equity investment of ~A$2 million will earn a 14.32% interest in the common equity of Corazon.
Corazon has interests in nickel-copper-cobalt assets in Canada (Lynn Lake) and Australia (Mt Gilmore and Miriam). Today Corazon announced a A$12 million capital raising (supported by BSX’s A$2 million) to accelerate its nickel exploration and development activities.
Read: Corazon Mining raising up to A$12.7 million supported by Blackstone Minerals A$2 million placement
The 100% Corazon owned Lynn Lake Project is northwest of Thompson in Manitoba, Canada and has historic mining and a current mineral resource of 168,000 tonnes of nickel, 81,700 tonnes of copper and 7,900 tonnes of cobalt. Lynn Lake is a development ready underground mine.
The tenure includes several advanced geophysical and geological targets beyond the A-Plug and EL mining centres.
MoU along with equity investment
Blackstone and Corazon have also entered an MoU that will see collaboration on the production of upstream and downstream nickel and cobalt concentrates and chemical products, potential offtake and/or joint ventures to meet demand from the growing electric vehicle battery industry.
The equity investment and MoU together represent the Corazon Transaction.
This transaction is expected to be completed on March 4, 2022. Blackstone will be issued 51,016,778 shares in Corazon and the issue price of A$0.04 per Corazon share represents a premium of 25% to the last closing share price.
Corazon transaction highlights
The deal benefits both parties.
- The Lynn Lake project is metallurgically de-risked based on historical production (24 years up until the 1970s) and exceptional flotation results achieved by Corazon.
- Part of the funds placed by Blackstone under the Corazon Transaction will be dedicated to testing electro-magnetic (EM) targets identified at the Fraser Lake Complex, which is underexplored and has existing nickel-copper sulphide drilling intersections.
- The Corazon transaction consolidates Blackstone’s footprint in Manitoba, Canada, with a rich mining history and access to an experienced workforce.
- The Lynn Lake Project has access to excellent infrastructure including renewable hydro power, aligning well with Blackstone’s commitment to sustainable mining practices.
- Blackstone and Corazon will form a Steering Committee which will include an ongoing assessment of opportunities to enter into supply, offtake and financing arrangements relating to upstream and downstream nickel and cobalt products produced at Lynn Lake.
“Blackstone’s recent Ta Khoa Nickel Project pre-feasibility study demonstrated the economic value and importance of securing upstream supply for its vertically integrated business. The Lynn Lake project boasts a meaningful nickel-copper-cobalt resource that the company believes has potential for a significant valuation uplift based on integration with the Ta Khoa Refinery,” Blackstone’s managing director Scott Williamson said.
“We are also very excited by the exploration potential at the Fraser Lake Complex and look forward to collaborating with the Corazon management team to progress mine planning and development activities.”