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Canada’s Cornish Metals (LON, TSX-V: CUSN) is selling its Nickel King property in the Northwest Territories to Northera Resources for up to $6 million (C$8m) to focus on advancing its flagship South Crofty tin project in the UK.
The deal includes a non-refundable payment of C$1 million from Northera within five days of signing the agreement and future shares post a go-public transaction.
The strategic move allows Cornish Metals to stay involved in Nickel King nickel-copper-cobalt asset’s potential future success, while focusing on South Crofty.
The results of a new preliminary economic assessment (PEA) for the UK project, published last month, confirmed the asset is one of the highest-grade tin resources globally, worth over $200 million.
The calculation was based on a tin price of $31,000 per tonne, slightly below its current valuation of $32,408 per tonne.
The Vancouver-based company has been working on bringing the past-producing South Crofty tin mine back to life since 2016.
The former operation has been shut since 1998 following more than 400 years of almost continuous production. It was the last tin mine in Europe when it closed. Several companies attempted to revive the flooded mines between 2001 and 2013, but due to persistent poor market conditions the assets were put into administration in 2013.
As part of Cornish Metals’ plans to reopen the historic mine, the company has said it would build new processing facilities and all the necessary site infrastructure. It has already obtained permission for underground mining until 2071 and an environmental permit to dewater the mine.
Tin is part of the UK’s critical metals list and its importance has also been recognized by other European Union governments, as well as the US and China.
