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Canada Nickel Company has agreed to acquire a 100% interest in the past producing Texmont property in Canada from an undisclosed firm.

The property is located between the Canada Nickel’s Deloro and Sothman properties south of Timmins, Ontario.

Under the binding agreement, Canada Nickel will pick a 100% stake in 14 mining leases. In exchange, the firm will make a $250,000 cash payment and issue a non-interest bearing promissory note of $3.75m by 14 March 2023.

Furthermore, upon deal completion, a 2% net smelter returns royalty on the property will be granted to the seller.

Canada Nickel said it plans to assess the validity of these interests. Earlier this year, the firm acquired 14 claims surrounding these mining leases as part of its regional property consolidation.

Canada Nickel Company chair and CEO Mark Selby said: “The acquisition of the Texmont property provides near-term smaller scale production potential and is highly complementary to our large-scale Crawford and regional nickel sulphide projects.

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“We are excited by the potential for leveraging the understanding of the geology at Texmont and additional high-grade areas at Sothman and Bannockburn and applying these learnings to our large regional property package. 

“In our discussions with nickel consumers for the battery market, many of them are keen to have new nickel production that could come to market by 2025. Similarly, a number of investors have expressed interest in financing near-term production.”

The Texmont Property involves a mine and mill that operated from July 1971 to December 1972 at a rated capacity of 500 tonnes per day.

As per the initial drilling results, the property hosts high-grade mineralisation in ultramafic rock.

Till date, Canada Nickel has completed four drill holes drilling that intersected significant intervals of mineralisation within the target ultramafic.

Canada Nickel said in a statement: “Drilling continues at Texmont with several holes planned for winter 2023, with the goal of producing a current resource estimate using historic and new data, as the basis for an open pit mine plan to support a potential restart by 2025 or provide a source of higher-grade feed for the Crawford Nickel Sulphide project.”