MPJ accelerates $1.4M capital raising to support WA nickel plays
Mining Projects Group (ASX: MPJ) is close to securing nearly $1.4M in capital to support the development of its nickel mining projects in Western Australia.
MPJ has signed a deal with Alignment Capital Pty Ltd that will see the company act as the lead broker to seek to place ordinary fully paid MPJ shares with professional and sophisticated investors.
Binding commitments have been received for subscriptions totalling $1.398M.
MPJ says the money will be used to fund its exploration programmes with the emphasis on supporting a 5,000m drilling campaign at its flagship Roe Hills nickel play east of Kalgoorlie.
A review of exploration data there has identified a number of high priority nickel sulphide targets.
The funds will also go toward supporting exploration at MPJ’s Fraser Range East and Dingo Range projects where it recently successfully conducted first-stage surveys.
Capital injection for MPJ
As MPJ ramps up its exploration efforts in WA the company has entered into an agreement with Alignment Capital Pty Ltd.
Alignment is acting as a corporate authorised representative of Pearce Callahan & Associates Pty Ltd for a proposed capital raising of up to $1.398M before costs.
Alignment have agreed to seek to place up to 233M ordinary fully paid MPJ shares with professional and sophisticated investors at an issue price of $0.006 (0.6 cents) per share.
It is intended that the Placement Shares will be issued without shareholder approval within the MPJ’s available placement capacity.
Each Placement Share will be issued with a free-attaching option with an exercise price of $0.01 and an expiry date of 30 June 2016.
The issue of the Placement Options will be subject to shareholder approval and will be sought following the issue of the Placement Shares.
MPJ says Alignment has informed it that to date it has received binding commitments for subscriptions of $1.398M. Alignment will receive placement and management fees equal to 6% excluding GST of all the funds raised.
It will also receive 50M options issued on the same terms as the Placement Options.
MPJ says the funds will be used to pay for works programmes at its WA nickel projects, specifically the Roe Hills Nickel Project. The proposed placement is expected to completed soon.
New nickel sulphide targets at Roe Hills nickel play
The Roe Hills project is located within a 50km length of prospective nickel bearing greenstone belt 110km east of the mining hub city of Kalgoorlie.
MPJ holds 100% ownership of five tenements covering a continuous strike of 40km of ultramafic rocks and 360km2 of prospective greenstone terrain.
An ongoing review of exploration data collected over the 40km strike length of MPJ’s Roe Hills Nickel Project has turned up several new nickel sulphide targets zones that will be explored with an initial stage 5,000m drilling campaign.
MPJ says the first stage Programme of Works (“POW”) has been approved by the Western Australian Department of Mines and Petroleum and its operator Newexco Services Pty Ltd is completing a comprehensive geophysical analysis of the aggregated data collected over several generations of geophysical surveys.
MPJ says Newexco’s review is intended to further refine the target priorities and negotiations are underway with drilling contractors to provide services for the programme.
The company’s Managing Director Joshua Wellisch says the new round of drilling is a pivotal point for the Roe Hills project.
“This is a result of the appointment and engagement of our decorated Technical Director Neil Hutchison,” he says.
“His work conducted in conjunction with our consultants has highlighted that the ultramafic unit is fertile with the potential to host significant new Nickel Sulphides and an exploration campaign has been planned using the most advanced techniques.”
Smarter drilling for Roe Hills
Historic exploration activity at Roe Hills started in 1965 and previous drilling for nickel sulphide mineralisation in the area defined three prospective ultramafic flows similar in style to that seen at the promiment WA nickel area of Kambalda.
The results include 0.5m at 6.15% from a downhole depth of 155m in a drill hole known as ROE114, which MPJ says confirms the potential for Roe Hills to contain nickel sulphide deposits set within ultramafic lava channels.
The majority of historic deep drilling on the prospect has been focused on one isolated area surrounding ROE114 but MPJ the review conducted by its Technical Director Neil Hutchison highlights potential remains along strike to the north and south.
Much of the drilling there has been shallow and does not intersect ultramafic flows which are crucial indicators of nickel sulphides.
But Hutchison says his analysis of the historic drilling data has confirmed that the rocks at Roe Hills have all the hallmarks of fertile nickel belts.
“Where there is smoke there is fire,” Hutchison says.
“The large low-grade nickel anomalies tend to get over looked in favour of the narrower high grade nickel intersections. Deposits such as Cosmos, Sinclair and Silver Swan were discovered in the proximity of these near-surface low grade disseminated sulphide occurrences which were drilled and identified long before the discovery of the high grade ore bodies. Modern nickel explorers understand the geological nickel forming processes much better nowadays and we also have access to powerful tools such as geochemical analysis software and Downhole EM which was not around before the late 1990s”.
EM surveys completed at Fraser Range nickel projects
Meanwhile, at MPJ’s two developing Fraser Range nickel plays its exploration operator Newexeco has completed the first stage of a Moving Loop Electro Magnetic Survey.
The EM survey tested for bedrock conductors because if these are present at both the Fraser Range East Project and the Dingo Range Project then there may also be nickel mineralisation within the area.
The tests also help to get a better understanding of the geological structure of MPJ’s land.
Fraser Range East Project results
At the Fraser Range East Project, Newexco found 94 stations which it analysed along seven profiles for a total of 18.2 line kilometres.
A broad anomaly was found in the mid-time area of the three westernmost lines and an anomalous response was taken note of at more than an 800m strike-length. The latter has anomaly open in both directions.
According to Newexco, the large wavelength of the anomaly ‘suggests the source is laterally extensive’.
Director Neil Hutchison said the MPJ survey programme is the first to take place in the Fraser Range tenements and they are very encouraged by the results.
“We await the result of the MMI soil sampling to assist in the interpretation of the anomaly so MPJ can determine the extent and most effective method for the follow-up exploration work,” he says.
Dingo Range Project results
Throughout June, more than 430 stations were observed by Newexco at the Dingo Range Project, and 34 profiles were observed along nearly 40 line kilometres.
Once again the surveys were conducted using the MLEM technique but Newexco ran out of time to carry out the MMI soil sampling, and this will be looked at on a later date.
The MLEM data reveals there are magnetic source rocks which could possibly be volcanic, mafic or ultramafic, located under pervasive cover. A number of weak anomalous responses were also found, the highest readings proving there is a presence of locally strong conductive cover.
Managing Director Joshua Wellisch said he was happy with the results. “It is early stages in the development of these recently acquired projects and it is very encouraging to have progressive results.”