Australian outback miner Mincor Resources N.L. said on Monday it has paid A$30 million ($23.6 million) to peg new ground in the hopes of finding more nickel.
The move pushed Mincor shares up more than 6 percent at one point. At 0350 GMT, the stock was 3.2 percent firmer at A$2.23. In January shares were A$0.64.
Nickel prices measured on the London Metal Exchange have more leapt to more than $34,000 a tonnes from around $13,000 in January on mounting signs of a global supply shortfall.
Mincor, formed five years ago from mines discarded as too small by the then Western Mining, now part of BHP Billiton Ltd./Plc. , said it had acquired a portfolio of mines in the ore-rich Kambalda region of far western Australia.
Mincor has reached an agreement with private miner Goldfields Mine Management Pty Ltd, to acquire the McMahon and Durkin mines, which Mincor said could contain close to 30,000 tonnes of the metal.
“This transaction opens a whole new exploration and production front for Mincor, and demonstrates our intention to use our excess cash resources to acquire proven assets in high-quality areas that provide both immediate value and long-term value,” managing director David Moore said in a statement.
Mincor already mines about 15,000 tonnes of nickel in the Kambalda region from four mines.
Mincor and other nickel miners in the outback, including Australian Mines Ltd. , Fox Resources Ltd. and Jubilee Mines NL are looking at ways to dig more nickel on expectations that demand for the metal will stay strong through at least the rest of the decade.
Nickel is added to stainless steel for toughness and shine. ($1=$1.27))