Nickel 28 Announces Q3 2021 Financial Results
NEWS RELEASE TSX Venture: NKL
FSE: 3JC0
NICKEL 28 ANNOUNCES Q3 2021 FINANCIAL RESULTS
TORONTO, ONTARIO, November 9, 2021 —Nickel 28 Capital Corp. (“Nickel 28” or the “Company”)
(TSXV: NKL) (FSE: 3JC0) is pleased to release its operating results for the nine-month and three-month
periods ending September 30, 2021, for the Company’s principal asset, an 8.56% joint -venture interest in
the Ramu Nickel-Cobalt (“Ramu”) integrated operation in Papua New Guinea. Additionally, Nickel 28 is
pleased to announce the receipt of its first free cash flow from Ramu, a US$3.2 million payment, as further
detailed below.
“The Ramu mine continued its outstanding performance in the 3 rd quarter of 2021, ” stated Anthony
Milewski, Chairman of the Board of Directors. “With another strong quarter of operations and sales, and
the repayment of the Ramu operating debt, Nickel 28 will continue to receive 35% or our attributable cash
flow on a semi -annual basis, which will ensure that the Company can pursue its ongoing strategy of
increasing shareholder value.”
Q3 2021 Highlights
The Company’s principal asset Ramu continued to have another strong quarter . Highlights from Ramu
during the quarter include:
- Total p roject revenue in YTD 2021 of over US$560 million , as a result of continued strong
nickel/cobalt commodity prices and improved payability for mixed hydroxide (“MHP”).
- Completed repayment of the Company’s operating debt from Ramu’s half year results, the first of
two debt tranches from Ramu, which triggered the payment of attributable cash-flow to the
Company.
- Nickel 28’s cash distribution from Ramu in H1 2021 was US$19.3 million of which $10.2 million
was used to retire the operating debt and $5.9 million was used to pay down the construction debt
netting the balance of $3.2 million which has been received by Nickel 28.
- Ramu produced 8,649 tonnes of contained nickel and 8 41 tonnes of contained cobalt in MHP in
Q3 with YTD production of 25,227 tonnes of nickel and 2,359 tonnes of cobalt contained in MHP
placing Ramu as the world’s largest producer of nickel and cobalt in MHP.
- Ramu actual cash costs of US$1.55 per pound of nickel produced as MHP (net of byproduct credits)
in Q3 and YTD cash costs of US$ 2.0 0 per pound of nickel, placing Ramu in the top quartile of
global nickel producers and the lowest cost producer from HPAL operations according to Wood
Mackenzie.
- Ramu sales of 8,084 tonnes of contained nickel in Q3 on track to exceed 2020 sales.
Ramu Production and Cost Table
Ramu’s unaudited operating and financial performance for the periods noted are presented below.
2020 2021
Q3 Q3 YTD Q3 Q3 YTD
Ore Processed (dry kt) 954 2,688 924 2,705
MHP Produced (dry tonne) 23,015 63,167 22,224 65,290
Contained Nickel (tonne) 9,048 25,286 8,649 25,227
Contained Cobalt (tonne) 821 2,941 841 2,359
Nickel Capacity Utilization (% of design1) 111% 103% 106% 103%
MHP Shipped (dry tonne) 16,529 50,674 20,423 71,113
Contained Nickel (tonne) 6,584 20,247 8,084 27,803
Contained Cobalt (tonne) 584 1,750 767 2,556
Cash Cost Actual 2 $1.84 $2.02 $1.55 $2.00
Note (1) Ramu design capacity of 32,600 tonne/year contained Ni
Note (2) Actual Cash Cost net of byproduct credit
A. Nickel 28 has included certain performance measures in this press release that do not have any standardized meaning prescribed
under International Financial Reporting Standards (“IFRS”), including “Cash Cost Actual”. The presentation of these non -IFRS
measures is intended to provide additional information and should not be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS. Other companies may calculate these non-IFRS measures differently.
B. These figures have not been audited and are subject to change. The information presented above has not been audited by the
Company's independent accountants, should not be considered a substitute for audited financial statements and should not be
regarded as a representation by the Company as to the actual financial results.
“Despite the challenges brought on by Covid -19, the operational team at Ramu and our partner MCC
continue to deliver exceptional performance” stated Anthony Milewski. “Although there have been some
inflation pressures from input commodities, those have been more than offset by improved cobalt prices
and increased payables for nickel and cobalt in MHP given its growing importance as a feed source for
lithium-ion battery production” continued Mr. Milewski. “YTD cash costs of $2.03 per pound of nickel
are back in line with expectations and reflect strong byproduct credits from cobalt”.
Ramu Mineral Resource and Reserve Update
The continued impact of Covid -19 has resulted in a delay to a planned visit by the Company’s
representatives to the Ramu operations to conduct a further review of mineral resource depletion.
“Our intention is to provide investo rs a general update on the status of mineral resources and reserves as
provided to the Company from MCC. Given the tremendous challenges in conducting any drilling and
inability to visit the mining operations in 2020 and 2021 by our own technical staff, we believe this update
provides the necessary information tha t supports expected depletion rates of mineral r esources and
reserves” stated Anthony Milewski. “We are in regular discussions with our partners at Ramu and expect
to mobilize our technical staff to visit the mine site and verify all mineral resource and reserve data in 2022,
provided travel restrictions to and from PNG allow” continued Mr. Milewski. “The rate of depletion of
mineral reserves is consistent with expected values. Once MCC is able to mobilize drill crews again, we
expect that infill drillin g and exploration drilling will recommence which we expect will lead to the
conversion of mineral resources to reserves and the delineation of additional mineral resources to Ramu”.
The Company previously disclosed that Ramu mineral reserves were 54 million tonnes as of December 31,
2019 and have been depleted approximately 4.1 million dry metric tonnes (“DMT”) in 2020, as 3.6 million
DMT of ore was processed in the Basumuk Refinery operations according to operational data that has been
reviewed. “The 3.6 million DMT processed in 2020 is consistent with the 3.6 million DMT processed in
2019 which represented a reserve depletion of approximately 4 million DMT,” noted Mr. Milewski.
The Company had previously disclosed the following resource and reserve tables dated as of December 31,
2019.
Table 1: Ramu Mineral Resources – Effective Date December 31, 20191, 2
Category Tonnage (Mt) Nickel Grade (%) Cobalt Grade (%)
Measured 77 0.86 0.09
Indicated 67 0.83 0.09
Measured & Indicated 145 0.84 0.09
Inferred 21 0.90 0.10
Table 2: Ramu Mineral Reserves – Effective Date December 31, 20192
Category Tonnage (Mt) Nickel Grade (%) Cobalt Grade (%)
Proven 21 0.91 0.10
Probable 33 0.85 0.09
Total Reserves 54 0.88 0.09
Notes:
1. Mineral resources at a cut off of 0.5% Ni and a minimum mineable thickness of 0.5m; mineral resources are
inclusive of mineral reserves; the figures may not add exactly due to rounding; mineral resources do not include
the +2mm rock fragments in the rocky saprolite layers; mineral resources that are not mineral reserves do not
have demonstrated economic viability.
2. Mineral reserves at a cut off of 0.5% Ni and a minimum mineable thickness of 0.5m; mineral reserves are
included in mineral resources; the figures may not add exactly due to rounding; mineral reserves do not include
the +2mm rock fragments in the rocky saprolite layers.
About Nickel 28
Nickel 28 Capital Corp. is a nickel-cobalt producer through its 8.56% joint -venture interest in the
producing, long-life and world-class Ramu Nickel-Cobalt Operation located in Papua New Guinea. Ramu
provides Nickel 28 with significant attributable nickel and cobalt production thereby offering our
shareholders direct exposure to two metals which are critical to the adoption of electric vehicles. In addition,
Nickel 28 manages a portfolio of 13 nickel and cobalt royalties on development and exploration projects in
Canada, Australia and Papua New Guinea.
Scientific and Technical Information
The majority owner and operator of Ramu is MCC Ramu Nico Ltd., a 67.02% owned subsidiary of MCC,
and is operated by Ramu NiCo Management (MCC) Limited, a wholly -owned subsidiary of MCC. MCC
is listed on the Hong Kong Stock Exchange and on the Shanghai Stock Exchange . The scientific and
technical information in this news release, as well as additional material scientific and technical information
with respect to the Ramu project, has been prepared by MCC in its capacity as operator of Ramu.
Disclosures of a scientific or technical nature in this news release have been reviewed on behalf of Nickel
28 by R. Mohan Srivastava, P. Geo. , an independent consultant to Nickel 28 and a “qualified person” as
defined by NI 43-101.
All estimates of mineral reserves and mineral resour ces in respect of Ramu in this news release are
presented in compliance with JORC. For reporting in a NI 43 -101 format, the inferred resources are not
totaled with the measured and indicated mineral resources. The Ramu data has been reviewed and verified
in relation to CIM best operating practices for reporting and for scope and content of JORC and NI 43-101
reporting through a due diligence conducted by an independent qualified person on behalf the Company.
The technical report in respect of the updated mineral resource and reserve estimate, when filed, will contain
more detailed information concerning individual responsibilities, associated quality assurance and quality
control, and other data verification matters, and the key assumptions, parameters and methods used by the
Company. Ramu is an operating mine and there are no known legal, political, environmental, or other risks
that could materially affect the potential development of the mineral resources or mineral reserves.
For additional scientific and technical information in respect of Ramu, including an overview of the
sampling, analytical, and test data underlying the Company’s previous mineral resource and reserve
estimates (and associated quality assurance and quality control, and other data verification matters, and the
key assumptions, parameters and methods used by the Company), please refer to the Company’s current
NI 43-101 technical report entitled “Ramu Nickel Cobalt Project, Located in Madang Province, Papua New
Guinea, NI 43-101 Technical Report” dated effective as of October 25, 2019 filed under the Company’s
profile on SEDAR at www.sedar.com.
Cautionary Note Regarding Forward-Looking Statements
This news release contains certain informat ion which constitutes ‘forward -looking statements’ and
‘forward-looking information’ within the meaning of applicable Canadian securities laws. Any statements
that are contained in this news release that are not statements of historical fact may be deemed to be forward-
looking statements. Forward -looking statements are often identified by terms such as “may”, “should”,
“anticipate”, “expect”, “potential”, “believe”, “intend” or the negative of these terms and similar
expressions. Forward-looking statements in this news release include, but are not limited to: statements and
figures with respect to the operational and financial results of the Ramu project; statements with respect to
the prospects of nickel and cobalt in the global electrification of vehicles; statements related to the
repayment of the Company’s Ramu operating debt (and the timing thereof) ; statements related to the
Company’s attributable cash flow and future cash flow receivable by the Company (and the receipt and
timing thereof); statements related to the production impacts of the Covid-19 pandemic; statements related
to future evaluation of mineral resource and reserve estimates by representatives of MCC and the Company;
and statements with respect to the business and assets of the Company and its strategy going forward .
Readers are cautioned not to place undue reliance on forward -looking statements. Forward -looking
statements involve known and unknown risks and uncertainties, most of which are beyond the Company’s
control. Should one or more of the risks or uncertainties underlying these forward -looking statements
materialize, or should assumptions underlying the forward -looking statements prove incorrect, actual
results, performance or achievements could vary materially from those expressed or implied by the forward-
looking statements.
This news release also contains references to estimates of mineral reserves and mineral resources. The
estimation of mineral reserves and mineral resources is inherently uncertain and involves subje ctive
judgments about many relevant factors. Mineral resources that are not mineral reserves do not have
demonstrated economic viability. The accuracy of any such estimates is a function of the quantity and
quality of available data, and of the assumptions made and judgments used in engineering and geological
interpretation, which may prove to be unreliable and depend, to a certain extent, upon the analysis of drilling
results and statistical inferences that may ultimately prove to be inaccurate. Mineral re serve and mineral
resource estimates may have to be re -estimated based on, among other things: (i) fluctuations in nickel,
cobalt or other mineral prices; (ii) results of drilling; (iii) results of metallurgical testing and other studies;
(iv) changes to proposed mining operations, including dilution; (v) the evaluation of mine plans subsequent
to the date of any estimates; and (vi) the possible failure to receive or maintain required permits, approvals
and licences.
The forward-looking statements contained herein are made as of the date of this release and, other than as
required by applicable securities laws, the Company does not assume any obligation to update or revise
them to reflect new events or circumstances. The forward-looking statements contained in this release are
expressly qualified by this cautionary statement.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in
the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
release. No securities regulatory authority has either approved or disapproved of the contents of this
news release.
Investor Contact:
Nickel 28 Investor Relations
Tel: 647.846.7765
Email: [email protected]