NEW YORK Royal Nickel
Corp. has signed a royalty purchase agreement with RK Mine
Finance in which RK will acquire a 1-percent net smelter return
royalty in the Dumont nickel project in Quebec for $15
The deal with RK Mine Finance, a
division of hedge fund Red Kite Group, was expected to close
May 10, Royal Nickel said.
"This royalty sale provides an
attractive form of financing, particularly in current capital
market conditions. The additional capital will allow us to
continue to aggressively advance the (Dumont) project once the
feasibility study is completed by midyear," Royal Nickel
president and chief executive officer Tyler Mitchelson said in
Meanwhile, Royal Nickel recorded
a first-quarter net loss of Canadian $1.8 million ($1.78
million) for the three months ended March 31, down from a net
loss of C$2.5 million in the same period last year.
The narrower loss was primarily
due to lower general and administrative expenses, which totaled
C$900,000 ($889,000), including lower consulting fees and
share-based payments, the Toronto-based company said.
"We remain on track to complete
the feasibility study by the middle of this year and continue
to expect we will receive the required permits for Dumont
during the second quarter of 2014," Mitchelson said. "At the
corporate level, our focus is on continued discussions with
potential partners aimed at entering into a development
financing arrangement in advance of the completion of the
Falling nickel prices in recent
months have not deterred seasoned mining investors, Mark Selby,
Royal Nickels senior vice president of business
development, told AMM earlier this month (
amm.com, May 2).
Construction on the Dumont Mine
is projected to start following the receipt of permits in 2014,
with commissioning to follow in late 2015. The mine is expected
to ramp up production in 2016.