VANCOUVER, BC, May 30, 2023
/CNW/ - FPX Nickel Corp. (TSXV: FPX) (OTCQB:
FPOCF) ("FPX" or the "Company") is pleased to
announce that it has closed a private placement financing (the
"Private Placement") with a new cornerstone strategic
investor, the major global stainless steel producer Outokumpu Oyj
("Outokumpu").
Under the terms of the Private Placement, FPX has issued
26,800,000 common shares ("Private Placement Common
Shares") in the capital of the Company to Outokumpu at a price
of C$0.60 per common share, for gross
proceeds of C$16,080,000. Upon
completion of the Private Placement, Outokumpu now owns
approximately 9.9% of FPX's issued and outstanding common shares on
a non-diluted basis.
"This strategic investment by Outokumpu represents a significant
technical validation of FPX's Baptiste Nickel Project
("Baptiste" or the "Project"), and underscores
Canada's critical role as a
supplier of choice to allied industrial partners in Europe and the
United States," commented Martin
Turenne, FPX's President and CEO. "Outokumpu is a large and
highly-regarded global operator, with a robust track record of
producing the world's most sustainable stainless steel, and is a
significant nickel consumer.
"Our partnership with Outokumpu testifies to Baptiste's
potential to produce a premium nickel product that can bypass the
intermediate smelting stage, thus becoming a highly sought-after
feedstock for the responsible production of low-carbon finished
products in multiple consumer and industrial markets, including
stainless steel. FPX is pleased to be Outokumpu's preferred
partner as they look to secure the sustainable, long-life nickel
units which are best aligned with their strategic objectives."
"The carbon footprint of Outokumpu's stainless steel is already
the smallest in the world, but we want to further decarbonize our
production," commented Marc-Simon
Schaar, Head of Raw Material Sourcing at Outokumpu.
"This would also mean the reduction of the emissions of our supply
chain, and to achieve this, we work together with our suppliers to
strengthen the sustainability of the entire supply chain –
including environmental, social and governance aspects. The
nickel to be produced from FPX's Baptiste deposit in Canada has the potential to have a very low
carbon footprint. Therefore, we are excited to be part of
this development project as a shareholder, which, once realized,
would provide an excellent low-emission source of nickel, and in a
composition which suits our own production."
The Company intends to use the net proceeds of the Private
Placement primarily for development activities at the Project,
including the completion of a preliminary feasibility study for
Baptiste, continuance of ongoing environmental baseline
activities, and feasibility study readiness activities, as well as
general corporate and administrative purposes. The TSX
Venture Exchange has provided final acceptance of the Private
Placement and the Common Shares issued pursuant to the Private
Placement are subject to a hold period of four (4) months and one
(1) day from the date of issuance in accordance with applicable
securities laws. No finders' fees or commissions were paid on
the Private Placement.
Transaction Details
Concurrent with the closing of the Private Placement:
- FPX granted a right of first offer ("ROFO") which will
provide Outokumpu the right, so long as it continues to hold the
Private Placement Common Shares, to negotiate, at market terms,
one or more offtake agreements with FPX for up to an aggregate of
60,000 tonnes of nickel (7,500 tonnes of nickel per year over a
period of eight years) from FPX's Baptiste Nickel Project.
- FPX and Outokumpu entered into an investor rights agreement
(the "Investor Rights Agreement") that provides, among other
things, Outokumpu with certain rights in the event it maintains
minimum ownership thresholds in the Company, including the right to
participate in equity financings. In addition, pursuant to the
Private Placement, Outokumpu has agreed to a two-year standstill
with respect to the acquisition of additional securities in FPX,
other than acquisitions pursuant to Outokumpu's rights under the
Investor Rights Agreement.
Based on the Company's 2020 preliminary economic assessment
("PEA"), the Baptiste project has the potential to produce
up to 44,900 tonnes of nickel per annum over a projected mine life
of 35 years. The PEA is preliminary in nature and includes
inferred mineral resources that are considered too speculative
geologically to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves.
Mineral resources are not mineral reserves and do not have
demonstrated economic viability. There is no certainty that
the conclusions or results as reported in the PEA will be realized.
See the Company's September 9, 2020
news release.
Andrew Osterloh, P.Eng., FPX
Nickel's Qualified Person under NI 43-101, has reviewed and
approved the technical content of this news release.
About Outokumpu
Outokumpu is the global leader in stainless steel. The
foundation of Outokumpu's business is its ability to tailor
stainless steel into any form and for almost any purpose. Stainless
steel is sustainable, durable and designed to last forever.
Outokumpu's customers use it to create civilization's basic
structures and its most famous landmarks as well as products for
households and various industries. Outokumpu employs approximately
8,500 professionals in close to 30 countries, with headquarters in
Helsinki, Finland and shares
listed on Nasdaq Helsinki. www.outokumpu.com
About the Decar Nickel
District
The Company's Decar Nickel District represents a large-scale
greenfield discovery of nickel mineralization in the form of a
naturally occurring nickel-iron alloy called awaruite
(Ni3Fe) hosted in an ultramafic/ophiolite complex.
FPX's mineral claims cover an area of 245 km2 west of
the Middle River and north of Trembleur Lake, in central British
Columbia. Awaruite mineralization has been identified in
several target areas within the ophiolite complex including the
Baptiste Deposit and the Van Target, as confirmed by drilling,
petrographic examination, electron probe analyses and outcrop
sampling. Since 2010, approximately US $28 million has been spent on the exploration and
development of Decar.
Of the four targets in the Decar Nickel District, the Baptiste
Deposit has been the focus of increasing resource definition (a
total of 99 holes and 33,700 m of
drilling completed), as well as environmental and engineering
studies to evaluate its potential as a bulk-tonnage open pit mining
project. The Baptiste Deposit is located within the Baptiste
Creek watershed, on the traditional and unceded territory of
Tl'azt'en Nation and Binche Whut'en First Nation, and within
several Tl'azt'enne and Binche Whut'enne keyohs. FPX has conducted
mineral exploration activities to date subject to the conditions of
our agreements with the Nations and keyoh holders.
About FPX Nickel Corp.
FPX Nickel Corp. is focused on the exploration and
development of the Decar Nickel District, located in central
British Columbia, and other
occurrences of the same unique style of naturally occurring
nickel-iron alloy mineralization known as awaruite. For more
information, please view the Company's website at
www.fpxnickel.com or contact Martin
Turenne, President and CEO, at (604) 681-8600 or
ceo@fpxnickel.com.
On behalf of FPX Nickel Corp.
"Martin Turenne"
Martin Turenne, President, CEO and
Director
Forward-Looking
Statements
This press release may contain "forward-looking information"
within the meaning of applicable Canadian securities laws,
including those describing FPX's future plans, and the expectations
of management that a stated result or condition will occur. These
statements address future events and conditions and so involve
inherent risks and uncertainties, as disclosed in the Company's
periodic filings with Canadian securities regulators, including its
Annual Information Form and MD&A, dated April 19, 2022 and March
30, 2023, respectively. Actual results could differ
materially from those currently projected by management at the time
of writing due to many factors the majority of which are beyond the
control of FPX and its management. In particular, this news release
contains forward-looking statements pertaining, directly or
indirectly, to the following: the use of proceeds of the Private
Placement; potential business synergies as a result of FPX's
partnership with Outokumpu; the expected receipt of stock exchange
approval, and the timing thereof; future off-take under the ROFO;
and the final terms of the ROFO and Investor Rights Agreement.
Readers are cautioned that the foregoing list of risk factors
should not be construed as exhaustive. These statements speak only
as of the date of this release or as of the date specified in the
documents accompanying this release, as the case may be. The
Company assume the obligation to update any forward-looking
statement except as expressly required by applicable securities
law
Neither the TSX Venture Exchange nor its Regulation Services
Provider accepts responsibility for the adequacy or accuracy of
this release.
SOURCE FPX Nickel Corp.