19 February 2025
Several investors led by mining entrepreneur Frank Giustra and his Fiore Group are putting $36 million into Botswana-focused nickel-copper-cobalt explorer Premium Resources (TSXV: PREM; US-OTC: PRMLF), the company said on Tuesday.
The non-brokered private placement of up to 120 million units at 30¢ apiece, is to accompany the Fiore Group becoming a strategic adviser to Premium, which is developing the Selebi and Selkirk properties in eastern Botswana.
Premium’s largest shareholder, Toronto-based wealth management firm EdgePoint Investment Group, has also agreed through its affiliate Cymbria to settle the company’s $20.8 million term loan debt for 69.6 million shares at 30¢ each.
“It’s an incredible deposit that is still open to get a lot bigger with very little expenditure on a fully permitted site for everything (and) it’s a past producer of copper and nickel,” Giustra told The Northern Miner by phone.
“This is potentially a world-class deposit, it just needs to be approached in a different manner (from previous managers).”
Shares in Premium Resources closed 11% lower at 35¢ apiece on Tuesday afternoon in Toronto, for a market capitalisation of $64.9 million. Its shares traded in a 52-week range of 33¢ to $1.53.
“I suspect that some people are trying to sell the stock to buy the units,” Giustra said. “The market isn’t aware of how big this financing will be and I suspect we’ll be upsizing it.”
Tier one advantages
Giustra stressed the sites’ governance and infrastructure benefits, including access to cheap power and a nearby rail line.
“(Botswana’s) mining laws are modelled after Canadian mining laws,” he said. “A lot of in-country mining engineers were trained in Canada.”
While the area doesn’t have close access to refineries, Giustra said Premium plans to conduct studies over the next nine to 12 months on whether it should build its own refinery or hydrometallurgy plant. The tailwinds for Premium follow its release three weeks ago of strong drill results at the past-producing Selebi North underground mine, where 13.9 million tonnes grading 0.74% nickel and 0.66% copper were mined from 1990 to 2016.
And six months ago, the company released an initial resource for Selebi North that outlined 3 million indicated tonnes grading 0.9% copper and 0.98% nickel for 27,000 tonnes contained copper and 29,000 tonnes nickel. Inferred resources measure 5.83 million tonnes grading 0.90% copper and 1.07% nickel for 52,000 tonnes contained copper and 62,000 tonnes nickel.
Selebi North is part of Premium’s Selebi mines project, which also consists of the Selebi Main deposit. The Selebi Main mine started production in 1980, and like Selebi North was suspended in 2016 due to a failure in the processing facility. Selebi North is about 410 km north of the nation’s capital Gaborone. Selebi Main hosts 18.9 million inferred tonnes grading 1.69% copper and 0.88% nickel for 319,000 tonnes contained copper and 165,00 tonnes of nickel.
Premium plans to update the resource estimate for both deposits around June or July, soon-to-become CEO Morgan Lekstrom told The Northern Miner in an interview. It also intends to complete upgrades to the Selebi North and Main shafts and start constructing a new mill in the second half of next year to commission it and start production in 2027-2028.
Geo-strategic project
After the financing closes, Lekstrom is to become CEO for Premium’s next stage of growth, taking over from interim CEO Paul Martin, who is to take the board chair role.
“With a proven track record in exploration and resource definition, we are proceeding through a careful and phased strategy to develop the Selebi and Selkirk assets, aiming to establish a strategically located and sustainable global supply of critical metals,” Lekstrom said, adding that he will also seek the next leader to guide the company through a larger expansion.
Mathew August is also joining Premium as strategic adviser on U.S. capital markets and Department of Defense (DoD) relations. August, who is experienced in the defence technology sector, brings “deep rooted” connections from the DoD, Lekstrom said.
“The strategic nature of Botswana and its commodities of copper, nickel and cobalt (makes) it an ideal candidate for U.S. investment,” he said.
“This would be getting a DoD foothold into Africa, where the Chinese have been very predominant in controlling the critical metal supply chain.”
Source: https://surl.li/fwtxns
