SUDBURY, ON, April 17 /CNW/ - Independent Nickel Corp. (INI: TSX-V) (the
"Company") reports that it has signed a binding letter agreement with
subsidiaries of Glencairn Gold Corporation ("Glencairn") to acquire their Net
Smelter Return Royalty ("NSR") of up to 3% (when nickel prices exceed US$6/lb)
on Victory Nickel Inc.'s Minago nickel deposit, as well as the 2% NSR on the
Company's Lynn Lake mine property, both located in Northern Manitoba.
Nuinsco Resources Limited filed a Preliminary Economic Assessment on the
Minago property on SEDAR on November 28, 2006.
In addition to purchasing the Minago royalty, the Company also
re-purchased the 2% NSR on its own 100% owned Lynn Lake nickel property. The
re-purchase of this royalty will significantly enhance the economics of the
Company's own project.
"The Minago Royalty is an obvious compliment to Independent Nickel's Lynn
Lake Nickel deposit," stated Independent Nickel President and CEO, Richard
Murphy. "Both assets provide shareholders of Independent Nickel with exposure
to advance staged nickel deposits in a very pro-mining jurisdiction. This
acquisition provides diversification at the project level and represents a
strategic asset to the Company. The Minago Royalty gives our shareholders
upside exposure to a high quality nickel deposit and comes with no operational
or sustaining capital obligations."
Commenting on the transaction, Glencairn President and CEO Peter
Tagliamonte stated: "We view this as a strategic divestiture for Glencairn
allowing us to increase the company's cash position and also retain the upside
of the Minago project moving forward. This is a beneficial arrangement for
both INI and Glencairn."
Under the terms of the purchase agreement, the Company will pay
$5 million in cash and issue 2,500,000 shares of the Company to Glencairn, in
exchange for the two royalties. In addition to any regulatory trading
restrictions, the shares will be initially subject to a trading restriction
under the agreement, the latter of which will be removed on a graduated basis
over two years.
The Minago royalty payments are determined on a sliding scale, based on
nickel prices. When the selling price for nickel exceeds US$6/lb the royalty
is 3%. If the selling price for nickel is between US$5 and US$6/lb the royalty
is 2%. If the selling price for nickel is between US$4 and US$5/lb the royalty
is 1.5%. And if the selling price for nickel is below US$4/lb the royalty is
1%. Nickel currently sells for approximately US$23/lb.
The acquisition, which is scheduled to close no later than June 30, 2007,
is subject to the Company completing a minimum $5 million equity financing, as
well as acceptance by the TSX Venture Exchange.
The Company's web site is www.independentnickel.com.
This document may contain forward-looking statements relating to
Independent Nickel Corp.'s (INI) operations or to the environment in which it
operates. Such statements are based on operations, estimates, forecasts and
projections. They are not guarantees of future performance and involve risks
and uncertainties that are difficult to predict and may be beyond INI's
control. A number of important factors could cause actual outcomes and results
to differ materially from those expressed in forward-looking statements,
including those set forth in other public filings. In addition, such
statements relate to the date on which they are made. Consequently, undue
reliance should not be placed on such forward-looking statements. INI
disclaims any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, save and except as may be required by applicable securities laws.
THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY
OR ACCURACY OF THE CONTENT OF THIS NEWS RELEASE
For further information:
For further information: Independent Nickel Corp., Richard Murphy,
President and CEO, or Guy Mahaffy, Chief Financial Officer, Tel: (705)
521-8444, Email: email@example.com, 957 Cambrian Heights Drive, Suite
102, Sudbury, Ontario, P3C 5M6