At the time of writing, shares of Axiom Mining Ltd [ASX:AVQ] are up by 16.67%, to 1.4 cents per share.
Why did Axiom Mining Ltd shares do this?
The company announced that Axiom KB Limited (Axiom’s subsidiary) was granted a mining lease over the San Jorge nickel deposit, part of the world-class Isabel Nickel Project, by the Solomon Islands government. The mining lease allows the company to extract, export and sell nickel ore and other associated commodities for 25 years.
What now for Axiom Mining Ltd?
It’s been a long-time coming for the company, mind you. I frequently supported this company in my previous investment newsletter, Resource Speculator at Port Phillip Publishing. But it proves that patience favours the brave!
The Isabel Nickel Project is made up of both the Kolosori deposit (on Santa Isabel Island and under application as discussed above) and the San Jorge deposit (on San Jorge Island and owned by the company). Both of these islands make up Isabel Province of the Solomon Islands.
This image portrays the project below:
Source: Axiom Mining
Isabel boasts 159 million tonnes of ore, grading 1.25% of nickel. That’s equivalent to 1.908 million tonnes of nickel concentrate — five times the size of Nova. The ore is shallow and merely needs to be dug up with a dozer and shipped. There’s no need for a massive deep-mine construction, saving hundreds of millions of dollars in capital costs.
The bottom line: Isabel is a world-class project and I believe it could prove lucrative for shareholders in the medium to long term. But, the company now needs funds to develop the San Jorge deposit. Axiom Mining is working on a funding facility which should be announced in the coming weeks. If the funding arrangement looks attractive for shareholders, the share price could potentially explode higher.
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