http://www.*.com.au/companies/news/64618/-segue-...

http://www.*.com.au/companies/news/...nt-in-fraser-range-nickel-project--64618.html


Segue Resources (ASX:SEG) has negotiated an $6.5 million investment from China controlled international resources house MMG Limited (HKG:1208) to farm into Segue's Plumridge Nickel Project in the Fraser Range.

MMG is the overseas nonferrous metals mining unit of state-owned metals trading major China Minmetals and will earn a 51% interest with tranched payments for exploration covering 8 tenements at the Plumridge Project.

For Segue's managing director Steven Michael this is a coup, given the farm-in values the nickel tenements alone at circa $12.7 million against Segue's latest market capitalisation of just $5.3 million.

It also injects exploration capital into the project during current challenging capital markets and relieves Segue of needing significant capital required for drilling in the Fraser Range.

Segue also gets to retain a 100% interest in 3 exploration licences prospective for gold which include the Corvette gold prospect and Salt Creek Intrusive Complex.

The Plumridge Gold Project lies 60 kilometres southwest of the +5 million ounce Tropicana Gold discovery.


More detail

The Plumridge Nickel Joint Venture (Joint Venture) allows MMG to earn up to a 70% interest by funding up to $14 million of exploration covering 2,250km2 of exploration licences across the Fraser Range.

Under the Joint Venture, MMG can earn an initial 51% interest through the expenditure of $6.5 million before 31 December 2019 (Stage 1), including $1.5 million to be spent before 31 December 2016.

Once MMG has met the Stage 1 requirements, MMG can elect to increase its interest by 19% (to 70%) through the additional expenditure of $7.5 million within two (2) years (Stage 2).

MMG must maintain all tenements in good standing during both Stage 1 and Stage 2.


Segue’s managing director, Steven Michael, said:

"The Plumridge Nickel Joint Venture with MMG is a significant milestone for Segue in the exploration for a world-class nickel deposit in the Fraser Range.

"The multi-million dollar, multi-year joint venture with a leading diversified base metals company will provide the necessary resources, both financial and technical, to adequately explore the extensive tenement holding at the Plumridge Nickel Project.

"MMG has a highly skilled team of geologists and geophysicists who will help maximise the potential for a significant nickel-copper discovery at Plumridge with a large and accelerated exploration programme. MMG will manage all exploration activities on the Joint Venture tenements and is required to spend a minimum of $1.5 million by 31 December 2016 and a further $5.0 million by 31 December 2019 to earn an initial 51% interest in the Joint Venture.

"If MMG elects to continue sole-funding beyond Stage 1, it can increase its interest to 70% through an additional $7.5 million of expenditure over two years. If this occurs, a total of $14 million would have been spent by MMG on the Plumridge Nickel Project, with Segue retaining a 30% interest."