Nautilus gains "significant momentum"

DEEPSEA explorer Nautilus Minerals is expecting more funds from its PNG state-owned joint venture partner Petromin.
Nautilus gains "significant momentum" Nautilus gains "significant momentum" Nautilus gains "significant momentum" Nautilus gains "significant momentum" Nautilus gains "significant momentum"

The explorer recently scuttled a $C150 million capital raising due to adverse market conditions but said it was evaluating a range of alternative options to access capital in the future.

Yet this week the company reported it had a $139 million cash position at the end of March and provided an update on its JV arrangements with Petromin.

Petromin's first payment of $US20-25 million to "secure" a 30% stake of Solwara 1 copper-gold project in the Bismarck Sea is due. The payment accounts for the project costs incurred up to January, when the mining lease was granted.

"The final amount will be determined through an audit process, with payment to be made by August 1," Nautilus said.

In an exploration campaign starting last year Nautilus identified the Solwara 12 seafloor deposit about 25km from its Solwara 1 project.

It said drilling of Solwara 12 was completed in May, analysis was underway and results would be released later this year.

Nautilus struck a JV agreement in April with Germany's Harren and Partner to build a production support vessel for the Solwara project. The vessel is expected to cost $A174 million with delivery in the first half of 2013.

"The granting of the mining lease was a major step forward for us, and we also were very pleased to welcome the PNG Government as a partner in this important project," CEO Steve Rogers said.

"The subsequent formation of the Harren joint venture has secured a state-of-the-art vessel for the project.

"Nautilus has now developed significant momentum, we are looking at alternative capital raising plans and look forward to announcing the results of our exploration campaigns in the coming months."

Initial seafloor mining at Solwara is designed to hit a production rate of 1.2 million tonnes per annum of dry ore delivered to Rabaul Port, with a ramp-up option to hit 1.8Mtpa.

First ore is expected 30 months after the project gets the final go-ahead.

The Solwara-1 project hosts an indicated resource of 870,000 tonnes with copper of 6.8%, gold at 4.8 grams per tonne and silver at 23gpt.

There is also an inferred resource of 1.3Mt at 7.5% copper, 7.2gpt gold and 37gpt silver.

The copper resources were calculated using a 4% copper cut-off.

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