December 2, 2021

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Through Education Matters

JV Report: Magna Mining aiming to capitalize on a at the time in a generation nickel cycle

Nickel sulphide deposits are at this time the most dependable source for the Class 1 nickel products necessary to develop battery-grade nickel.

As the demand from customers for battery-grade nickel steadily climbs with just about every passing 12 months, the deficiency of new nickel sulphide discoveries turns into extra acute.

In accordance to S&P International, concerning 1990 and 2019, of the 10 important sulphide discoveries globally, only Vale’s Voisey’s Bay in Canada was in generation in 2020. Of the remaining 9, only 3 have a accomplished feasibility review and could move toward production in excess of the upcoming quite a few decades (S&P World-wide, 2020).

The inescapable conclusion is that the structural change in the direction of electrical autos (EVs) really should underpin powerful nickel rates for the foreseeable foreseeable future. Additional specifically, the main beneficiaries would show up to be producers with nickel sulphide deposits who can cost-correctly develop the course 1 product or service essential by the rapidly developing battery marketplace.

Even so, the connected implications for nickel demand from this structural shift haven’t often been as apparent as they are nowadays. In fact, it was only 5 several years in the past that the outlook for nickel was markedly various as costs strike a 10 12 months low in 2016. Shockingly, this was only six years after the outstanding results of Sudbury nickel and copper miner FNX had culminated in a $1.7 billion buyout from Quadra.

For the Sudbury-primarily based former FNX Mining workforce who established Magna Mining (TSXV: NICU), the market place apathy towards nickel as selling prices hit their troughs in 2016 was the opportunity for which they experienced been patiently awaiting. After pinpointing the earlier-producing nickel-copper-platinum-group metals (PGM) Shakespeare mine as an asset of strategic significance for the Sudbury region, the Magna group approached the proprietors subsequently agreed to offer Shakespeare to them to concentration on other core initiatives in their portfolio.

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Drilling at the Shakespeare mine. Impression from Magna Mining.
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“We realized from our knowledge in the area that high top quality, quickly available nickel sulphide deposits like Shakespeare are unbelievably challenging to obtain, and there are incredibly number of destinations in the environment that can boast the nickel mining historical past of Sudbury,” CEO and director Jason Jessup tells The Northern Miner.

To begin with, the Shakespeare residence was owned by Falconbridge (now Glencore) ahead of currently being optioned to junior explorer Ursa Important in 2000. Less than the ownership of Ursa Major, the open up-pit mine was briefly in manufacturing from 2010 to 2012. A combination of minimal nickel charges and the non-renewal of a toll milling deal with Xstrata (Glencore) forced the open-pit mine to go on care and maintenance in early 2012. As extensive-expression Sudbury miners and geologists, the workforce at Magna Mining shortly regarded the possibility to purchase a permitted mine and mill website with an present resource at the bottom of the market.

Now, four decades later on, soon after a recent $7 million profitable funds increase and listing on the TSXV, Magna Mining is perfectly positioned with an superior phase challenge that also includes 180 sq.km. of exploration potential adjacent to the entire world-well known Sudbury basin, host to some of the most sizeable nickel sulphide deposits at any time to be found out.

Shakespeare has an current compliant Countrywide Instrument 43-101 source and important permits in area to build a 4,500 tonne per day mill and the restart of open-pit mining. According to Jessup, these permits and the prior generation at the brownfield Shakespeare mine deliver a prospective fast observe back again to output.

The undertaking is 70 km from Sudbury, and there is toll milling and smelting capability inside of trucking distance of the mine. “It is this existing potential which could possibly let us to get begun on creation at minimized capex due to the fact we wouldn’t always want to build a mill immediately,” suggests Jessup.

The prior generation at the job also served to de-hazard the metallurgy at Shakespeare. Jessup notes that previous processing at an existing Sudbury mill (through toll milling) shown “excellent recoveries” working with common flotation processing. While in professional output, the mine produced ore that experienced payable nickel, copper, cobalt, platinum, palladium and gold.

Shakespeare currently has an open-pit resource of 14.436 million tonnes grading .34% nickel, .37% copper, .02% cobalt, .34 gram per tonne platinum, .37 gram per tonne palladium and .19 gram per tonne gold in the indicated group.

It also has 1.7 million tonnes of open up-pit source grading .29% nickel, .31% copper, and .74 gram for each tonne PGMs in the inferred category.

Notably, Magna’s present useful resource attracts upon only two deposits on the big land deal, which is hugely prospective for other nickel, copper and PGM discoveries. Though a mining restart is actively getting evaluated, the existing Shakespeare deposit is open up for enlargement on strike, depth, and footwall.

“Regionally, there are more than 12 targets determined which have possible to host economic deposits that could feed Shakespeare or most likely be toll-milled in Sudbury,” states Jessup.

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Drill rig at the Shakespeare mine. Graphic from Magna Mining.
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This year, diamond drilling has been aiming to enhance the current source by concentrating on the Hole Zone and extensions of the West deposit. The business has also conducted borehole electromagnetics from platform holes in the central footwall spot of the deposit to detect new zones beneath the current source.

The early final results have been encouraging preliminary 2021 drilling intersected 33.8 metres of nickel-copper-PGM mineralization in hole MMC-21-15, which specific the Gap Zone. These effects had been outside of the recent mineral resource and prolonged outside the house of the 2021 open up-pit useful resource shell.

The ongoing target on exploration seems promising. An inversion of airborne gravity data experienced discovered a dense anomaly in the footwall of the East Deposit, which may perhaps be associated to the Shakespeare Intrusion. The gravity anomaly will be drill examined as component of the existing drill method.

“Fieldwork has determined a mafic-ultramafic rock device to the south of the deposit which could be a minimal-sulphide-PGM target, as nicely as a potential heat source and feeder procedure for the Shakespeare mineralization and possible footwall mineralization,” claims Jessup.

Added drilling and observe-up will be done right before the finish of this years’ exploration plan. Meanwhile, the relaxation of the 180 sq.km. land offer consists of 30 km of strike of underexplored, prospective geology for various base and cherished metallic commodities.

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Springer pit at the Shakespeare mine. Impression from Magna Mining.
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Some of the exploration targets that Magna has prioritized in their regional drill method consist of the Springer Pit, the P-4 focus on and the past-manufacturing Spanish River copper mine site.

The Springer pit is a copper-gold goal about 5 km southeast of the Shakespeare deposit. At the exact same time, P-4 is a highly prospective target 5 kilometres to the west, which reveals similarities to the Shakespeare deposit. “Recent perform at the previous-producing Spanish River copper mine web site offers encouraging visual samples,” says Jessup.

Assay outcomes for these targets keep on being pending.

Jessup also thinks that the land package stays highly future for producing new discoveries, noting that the comprehensive magmatic method has the potential for significant grades. The various untested new targets are supported by electromagnetic plates defined as early as 2015 by a multipurpose time-domain electromagnetic survey and verified by a 2021 ground EM survey.

“These electromagnetic geophysical targets have excellent accessibility and are all inside considerably less than 200 metres from the area. These types of devices have the potential for deep roots. We will be systematically testing supplemental regional targets about the up coming 18 to 24 months,” suggests Jessup.

Within just two several years of the Falconbridge and Inco takeovers in 2006, and next document-high nickel selling prices in 2007, plunging nickel prices amid the great fiscal disaster of 2008 led to a significant curtailment of nickel exploration and progress around Sudbury. But abruptly, the rising battery metals paradigm gives nickel explorers and builders a new lease of life. The unparalleled improve in implied need for course one particular nickel from the EV sector and a subsequent rebound in the nickel price lastly seem to be to have created the proper setting for new exploration and mine progress to flourish once once again in Canada’s historic nickel manufacturing money.

Indeed, the emergence of a new wave of corporate action would seem to bode properly for the rapid upcoming of the nickel sector.

So much this yr, Tesla has signed offtake agreements in anticipation of battery-grade nickel supply shortages. Australia has also witnessed continual speculation bordering the consolidation of two of its premier nickel miners, Western Areas and IGO. The ongoing battle for Canada’s Noront Means (TSXV: NOT) between BHP (NYSE: BHP LSE: BHP ASX: BHP) and billionaire Andrew Forrest’s Wyloo Metals is just the most latest catalyst pushing the sector into uncharted territory.

Probably an additional summary to draw from this current flurry of company activity is that EV suppliers appear to be to be really selective when executing offer and offtake agreements for nickel. Anecdotally, it is getting to be significantly obvious that EV suppliers are eager to prevent sourcing nickel supply derived from creation processes with a high carbon footprint and a substantial environmental price, an accusation usually built in opposition to the nickel products that are sourced from laterite ores in Indonesia and the Philippines. This is not a shock to the Magna workforce.

“We are not amazed to see the EV sector steer away from signing offer agreements with initiatives in these international locations,” added Jessup. “It’s inconceivable that the two EV producers and people will dismiss the source chain for these important battery metals.

“As a final result, we’re hugely self-confident that nickel sulphide deposits, such as Shakespeare, in jurisdictions with proven frameworks for environmental influence mitigation such as Ontario, will be at the top rated of the list as mining firms and EV companies glance to secure long term metal provides. We absolutely assume to see extra M&A activity in the sulphide nickel space as producers glance to secure their following nickel improvement challenge,” claims Jessup.

Magna’s Toronto-quoted shares last traded at $.47 for each share, offering it a market capitalization of $27.6 million. The $7 million financing, concurrent with the reverse takeover transaction in Might, was priced at $.40.

The previous Joint Undertaking article is PROMOTED Articles sponsored by Magna Mining and made in cooperation with The Northern Miner. Visit magnamining.com for more information and facts.