****HUGE NEWS****
Dumont Nickel Inc -
Dumont Nickel signs agreement with Hunter Dickinson
Dumont Nickel Inc DNI
Shares issued 15,245,074 1999-05-18 close $0.73
Tuesday May 18 1999
Mr. Denis Clement reports
Dumont has signed a contract formalizing the letter of intent with Hunter Dickinson Group Inc., ("HDG"), previously announced in Stockwatch April 15, 1999. Limited partnerships associated with HDG have the right to finance up to $7.5-million on exploration of Dumont's 100 per cent owned nickel-copper-platinum group metal projects in the Raglan area of Northern Quebec. Phase 1 of the program is budgeted for $2.5-million and is scheduled to have a first closing on June 3, 1999. Dumont's exploration camp is currently being mobilized and drilling is scheduled to commence the last week of June. Details on Dumont's program are available at Dumont's Web site www.dumontnickel.com.
HDG is a private Canadian company associated with the Hunter Dickinson team, who are among Canada's most successful explorationists. The transaction is subject to regulatory approval.
Under Phase 1 of the agreement, a limited partnership ("LP") will finance $2.5-million of exploration expenditures in exchange for a 30 per cent working interest in Dumont's Raglan properties. After completion of Phase 1, Dumont will have a call on the working interest by paying 130 per cent of the exploration expenditures incurred by the LP. The acquisition of the working interest would be completed by issuing Dumont shares valued at market prices prevailing at the time of exercise of the call, together with a bonus equal to 50 per cent of the dilution (in shares) saved by issuing at market prices versus a base price of 50 cents per share.
Phases 2 and 3 will have similar structures for 25 per cent and 5 per cent interests, respectively, but the base price for the call will be the share price at the time of the call.
Denis Clement, chairman of Dumont said, "Dumont is pleased to be associated with the Hunter Dickinson team. They have a proven track record of identifying major projects at an early stage and an international reputation in delivering superior returns to the shareholders of companies in which they participate."
Robert Dickinson of Hunter Dickinson said, "Dumont holds an impressive property position on the Raglan horizon adjacent to and on strike with Falconbridge's new high-grade, nickel-copper-platinum mining operation. Dumont's exploration to date on its Lac Raglan property clearly indicates the potential for major discoveries and drill planning has commenced."
Dumont's 178 square kilometre Lac Raglan property covers 31 kilometres of the favourable Raglan horizon immediately to the east and west of Falconbridge's Raglan mining operation. Falconbridge opened its Raglan operations in December 1997 at a cost of $580-million (Canadian). Based upon a reserve of 22.1 million tonnes averaging 3.06 per cent Ni, 0.87 per cent Cu and significant grades of platinum-group elements, Raglan is scheduled to produce 130,000 tons per year of high grade nickel-copper concentrate for the recovery of 21,000 tons of nickel, 5,000 tons of copper, 200 tons of cobalt and significant quantities of platinum group elements at a production of cost of just $1.50 (U.S.) per pound of nickel. This makes the mine one of the lowest cost nickel operations in the world. (Mining Magazine, November 1998). The Raglan consists of a series of high-grade deposits, grouped into major ore zones hosted within the Raglan horizon. These major zones include Donaldson (3,510,000 tonnes at 3.75 per cent Ni, 0.83 per cent Cu, 6.6 grams per tonne PGE), Katinniq (8,970,000 tonnes at 3.06 per cent Ni, 0.89 per cent Cu), Zone 2 (2,650,000 tonnes at 2.62 per cent Ni, 0.84 per cent Cu) and Cross Lake (two million tonnes at 2.06 per cent Ni, 1.05 per cent Cu, 5.95 grams per tonne PGE) (Falconbridge, PDA, March 1998).
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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