Agreement to boost its interest in the Falconbridge Dominicana (Falcondo) nickel operation from 1.7% to 2.2% has been reached, Redstone Resources (TSE) reported.
Falcondo produces 68 million lb. nickel per year at a cash cost of about US$2 per lb. and has mineral reserves for 13 more years of production, Redstone said. Redstone’s beneficial interest is more than 1.5 million lb. nickel per year.
A $2-million private placement (one million shares at $2 each) is planned by Redstone to finance the acquisition and provide additional working capital. Associated company Franco-Nevada Mining (TSE) intends to subscribe for 400,000 shares to maintain its approximate 40% interest in Redstone. Securities firms Gordon Capital and First Marathon will act as agents in the sale of the remaining 600,000 shares.
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