oxiana outed as ausquests nickel suitor

Oxiana outed as AusQuest’s nickel suitor

23rd June 2007, 9:15 WST



Oxiana has purchased a strategic stake in WA explorer AusQuest in the hope of finding a nickel project worth developing.

The mid-tier Melbourne miner currently produces copper, gold and zinc, but it has also expressed interest in nickel. It is examining an early-stage laterite project in WA it picked up through its acquisition of Agincourt Resources this year.

AusQuest recently began drilling its nickel prospects in the Pilbara region. Earlier this month, the explorer found nickel sulphides in four of the first eight holes at its Bellary project. The assays are not expected for another three to five weeks.

AusQuest outed Oxiana yesterday as the mystery buyer of 5.4 million shares and 3.6 million options on Wednesday.

Oxiana spokeswoman Natalie Worley said her company purchased the stake because AusQuest’s founders had a good track record of discovering nickel.

“We’ve said we’re looking at nickel,” she said. “By buying these shares it’s the start of a relationship with them. In the future it could lead to a joint venture and we could do some kind of funding of their projects.”

Oxiana’s exploration manager, Tony Manini, knew AusQuest managing director Graeme Drew from their time at Rio. Mr Drew was involved with the discovery of the Honeymoon Well nickel deposit in WA, one of the biggest undeveloped nickel sulphide deposits in the world which is now owned by LionOre Mining.

AusQuest’s exploration record has been mixed. It signed joint venture deals with Rio on iron ore and diamond prospects, but the mining giant withdrew from two following disappointing exploration results.

AusQuest shares closed 3.5¢ higher at 26¢ yesterday.

JAMIE FREED