Vancouver – Victory Nickel (NI-T) has drilled nickel mineralization north of the main deposit at its Minago nickel sulphide project as it works to improve the economics of a December feasibility study.
The company conducted a 26 hole winter drill program at its Minago property in northern Manitoba largely to upgrade the known deposit but also to explore possible mineralization elsewhere on the property.
Hole 21, drilled 900 metres north of the edge of the Minago Nose deposit, cut multiple low-grade nickel intervals including 52.2 metres grading 0.57% nickel from 173 metres, 18.3 metres carrying 0.54% nickel from 260 metres, and 121.6 metres grading 0.33% nickel from 283 metres, including 4.2 metres averaging 1.39%. The company also highlighted a 0.13-metre section grading 13.4% nickel at 88.6 metres depth.
Approximately 70 metres south, hole 10-13 hit 5.2 metres grading 1.65% nickel from 99 metres, then 133.9 metres averaging 0.5% nickel from 181 metres downhole.
All but three of the holes from the winter campaign were targeted at increasing the near-surface resource of the existing deposit. The mineralization sitting near the contact with the overlying sandstone was not included in the recent feasibility study due to lack of drill coverage.
In May the company released several assay results from the infill campaign that it says will allow further mineralization to be included to enhance the project economics. Results included 101 metres grading 0.95% nickel, 191.7 metres carrying 0.51% nickel, 11.1 metres averaging 1.55% nickel and 203.3 metres intercepting 0.63% nickel.
In June Victory made improvements to the project economics compared to the December figures following the purchase of refurbished electrical equipment. Minago’s base case internal rate of return for the open-pit project increased 2.1% to 19.8% and the net present value increased $85 million to $487.6 million using a 6% discount rate.
The feasibility study was based on a measured and indicated resource of 44.1 million tonnes grading 0.43% nickel. The project hosts a further 12 million inferred tonnes grading 0.44% nickel that the company is working to upgrade.
The company submitted an environmental impact statement for the Minago project in May.
Victory Nickel and Prophecy Resources (PCY-V) entered into reciprocal private placements in May. Prophecy subscribed for 36.6 million shares in Victory at 10.4¢ per share while Victory subscribed for 7 million Prophecy shares at 54.4¢. The transaction resulted in Victory holding a 9.9% interest in Prophecy and Prophecy in turn holding a 9.8% interest in Victory. Prophecy also has an option to earn 100% of Victory’s Lynn Lake nickel project in Manitoba.
Victory’s share price closed unchanged at 9.5¢ following the latest drill results. The company has a 52-week share price range between 5.5¢ and 24¢ and 376 million shares outstanding.
This discovery and future mine appears to be very undervalued and a real bargain at around .10/share. I’m just trying to figure out why it’s still floundering in that range when the nickel price is rising and the deposit keeps getting bigger? Anyone help shed some light there?