Magna Mining (TSXV: NICU) says its first resource for its Denison nickel, copper and platinum group metals project in Ontario’s Sudbury basin shows “significant potential.”
Magna is exploring the restart of a past-producing underground mine and the development of an open-pit operation to the site, also known as Crean Hill. As well, Magna owns the advanced-stage Shakespeare, a similar project in the same region.
Denison’s indicated resource for both underground and open pit totals more than 31 million tonnes, Magna said.
“The Denison project has considerable remaining mineralization and has the potential to, once again, become a significant producing mine,” Magna chief executive officer Jason Jessup said in a news release. “We plan to commence our maiden exploration program at Crean Hill and commission a new technical study to demonstrate the potential synergies between Crean Hill and Shakespeare.”
The indicated open-pit resource is 16.8 million tonnes grading 0.53% nickel, 0.49% copper, and 0.02% cobalt (1.08% nickel equivalent). It also has 0.48 gram platinum, 0.37 gram palladium and 0.25 gram gold per tonne, the company said.
The underground indicated resource is 14.5 million tonnes grading 0.56% nickel, 0.84% copper and 0.03% cobalt for 2.07% nickel equivalent. It also has 0.88 gram platinum, 1.02 gram palladium and 0.54 gram gold.
Magna and other project developers and explorers are taking advantage of new techniques and the rising demand for metals needed for the global clean energy transition to make past-producing mines profitable again. Nickel, copper and platinum group metals are important for making all kinds of new technology such as electric vehicle batteries, mobile phones and wind turbines.
Paul Fowler, a senior vice-president at Magna, said the Denison project could rival discoveries by FNX Mining in the Sudbury basin nearly two decades ago.
“There remains a lot of exploration potential in the footwall zone where we are going to re-commence drilling immediately,” Fowler said by email. “There are a lot of historical high-grade hits in the footwall with phenomenal long intersections.”
Magna acquired Denison with the $16-million purchase of Lonmin Canada in August. Denison operated as Crean Hill for Inco for about 80 years in three periods from 1906 to 2002. Vale (NYSE: VALE) ran the site as a joint venture with Lonmin before they closed the mine in 2017.
The Shakespeare project, 37 km west of Denison, also hosts a past-producing nickel-copper-platinum group metals mine. It has an indicated resource of 20.3 million tonnes grading 0.33% nickel, 0.36% copper, 0.32 gram platinum per tonne, 0.35 gram palladium and 0.19 gram gold. Magna has permits for the construction of a 4,500-tonne-per-day mill and the re-start of open pit mining at Shakespeare.
“The proximity of our other project, the permitted mine and mill site at Shakespeare, means that this asset is a natural fit for our company and gives us a unique advantage in exploring and developing Crean Hill,” CEO Jessup said.
Shares in Magna rose 14¢, or nearly 40%, to 50¢ in afternoon trading on Tuesday in Toronto, valuing the company at $35.1 million. The stock has traded in a 52-week range of 24¢ to 58¢.