Anglo American takes 9.9% stake in Canada Nickel

Canada Nickel Company Inc. [CNC-TSXV] on Wednesday announced another key milestone for its flagship Crawford nickel sulphide project near Timmins, Ont. and said Anglo American Plc [AAUKF-OTCQX] has become a 9.9% shareholder.

“We are very pleased to welcome Anglo American, a leading global mining company as a cornerstone investor in Canada Nickel,’’ said the company’s Chair and CEO Mark Selby. “Our team is looking forward to working with Anglo American to identify opportunities to apply their industry-leading mining innovation technology to add additional value to Crawford,’’ he said.

Anglo American is a global mining giant with interests in platinum, palladium and diamonds via its 85% stake in De Beers Group.

Under the terms of a subscription agreement Anglo American is making a $24 million investment in Canada Nickel at $1.95 per share.

On February 7, 2023, Canada Nickel shares closed at $2.00, after gaining 16.2% or 28 cents on volume of 903,680. The shares trade in a 52-week range of $4.01 and $1.18.

Upon closing of the subscription agreement, Canada Nickel will also enter into a binding offtake term sheet with Anglo American, giving Anglo an exclusive right to purchase up to 10% of recoveries of nickel concentrate, iron and chromium contained in magnetite concentrates and any corresponding carbon credits from the Crawford project.

In addition, Canada Nickel has agreed to enter into a material transfer and technology testing deal with Anglo to assess opportunities to add value to Crawford from Anglo’s FutureSmart Mining technology program.

“Crawford is poised to support the energy transition through the large-scale production of critical minerals, including nickel and cobalt and to become a North American producer of chromium, while also supporting the country’s climate objectives through large scale carbon capture and storage,’’ Selby said recently.

In a recent press release, the company said the latest test work results support the incorporation of carbon capture and storage into its Crawford project.

The company said its In-Process Tailings Carbonization process (IPT) is a novel method for accelerated carbon capture and storage that it believes has transformative potential.

An integrated feasibility study for the project is expected to be delivered in the second quarter of 2023. “This delay has no impact on the overall timeline for production as the company continues to target receipt of permits by mid-2025, with construction to follow,’’ Canada Nickel said.

On Wednesday, Canada Nickel said the technology transfer and testing agreement with Anglo will remain in force until 12 months after the delivery of a sample of ore in an amount of at least 100 tonnes by Canada Nickel, expected by 2024. For the duration of the agreement, Canada Nickel agrees to deal exclusively with Anglo American in those areas where FutureSmart Mining technologies apply.

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