Stellar to acquire Philippine ground

The Vancouver Stock Exchange has granted approval to Stellar Gold to acquire two nickel properties in the Philippines.

The Palawan and Surigao properties contain about 187 million tonnes grading 1.4% nickel and 0.1% cobalt, as well as a potential resource of 90 million tonnes with similar grades.

Stellar will issue 1.5 million common shares to Vancouver-based Pacific Nickel. In return, Stellar will receive from Pacific Nickel 40% of the issued shares of two Philippine companies in which the latter holds interests.

Stellar will operate the properties.

Meanwhile, BHP can earn up to a 70% working interest in the proposed operation by making cash payments to Stellar and funding exploration up to, and including, a feasibility study. Stellar will retain the right to export up to 500,000 tonnes of high-grade saprolite nickel ore per year, until BHP begins production.

Stellar will issue up to 9.1 million shares to the vendors (Pacific Nickel and the two Philippine companies), provided it receives a positive feasibility study.

In addition, once BHP pays Stellar US$500,000 and commits to a feasibility study, the latter will issue 3.5 million shares. BHP will issue 5.6 million shares when an additional US$5 million is paid and construction of the processing plant begins.

Stellar plans to raise $600,000 through the issue of 150,000 units and $3 million through a private placement.