First Nickel Monetizes Hedge Positions
TORONTO, ONTARIO -- (Marketwire) -- 09/27/11 -- First Nickel Inc. ('First Nickel' or the 'Company') (TSX: FNI) today announced that it has closed out the hedge position of 15 million pounds of nickel, 12 million pounds of copper and the corresponding foreign exchange and interest rate contracts entered into in July 2011 as required under the project debt facility. The Company will receive net cash proceeds of approximately US$35 million as a result of this transaction. The proceeds will be used to fund the remaining costs to complete the Lockerby project and for general corporate purposes. The Company no longer plans to utilize the project debt facility to fund Lockerby Mine costs and availability under the facility has been reduced to a nominal amount.
First Nickel monetized the 15 million pound nickel hedge at an average realized price of US$8.38 per pound nickel, the 12 million pound copper hedge at an average realized price of US$3.26.
Thomas M. Boehlert, Chief Executive Officer, said 'Recent weakness in metal prices provided First Nickel with an opportunity to fully fund the remaining Lockerby project costs without the use of debt and significantly improved corporate liquidity at the same time. First Nickel is now well positioned with the Lockerby Mine in production and a strong balance sheet.'
About First Nickel
First Nickel is a Canadian mining and exploration company that is in production at its Lockerby nickel / copper mine in the Sudbury Basin in northern Ontario. Once the Lockerby Mine reaches full production (expected in 2012), it will produce approximately 10 million pounds of nickel and approximately 7 million pounds of copper annually, providing a strong base of cash flow from which to grow the Company. In addition to the Lockerby nickel mine, the Company owns exploration properties in the Sudbury Basin, the Timmins region of northern Ontario, and the Belmont region of Eastern Ontario. First Nickel's shares are traded on the TSX under the symbol FNI.
Some of the statements contained in this news release are forward-looking statements, such as statements concerning the anticipated use of net proceeds of the closing of the hedge and other statements that describe First Nickel's future plans, intentions, objectives or goals, and specifically include but are not limited to production at the Lockerby Mine. In certain cases, forward-looking statements can be identified by the use of words such as 'expects', 'will', 'enable', 'anticipates', 'estimated' or words of similar effect. Since forward-looking statements are not statements of historical fact and address future events, conditions and expectations, forward-looking statements inherently involve unknown risks, uncertainties, assumptions and other factors well beyond the Company's ability to control or predict. Actual results and developments may differ materially from those contemplated by such forward-looking statements depending on, among others, such key factors as fluctuating metal prices, maintaining operating and exploration teams, and other factors described in the Company's most recently filed Annual Information Form under the heading 'Risk Factors' which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ('SEDAR') located at www.sedar.com. The forward-looking statements included in this document represent First Nickel's views as of the date of this document and subsequent events and developments may cause First Nickel's views to change. These forward-looking statements should not be relied upon as representing First Nickel's views as of any date subsequent to the date of this document. Although First Nickel has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking statements.
Contacts:
First Nickel Inc.
Thomas Boehlert
President & CEO
(416) 362-7050
(416) 362-9050 (FAX)
tboehlert@firstnickel.com