First Atlantic secures $3.0 million for Newfoundland drilling

First Atlantic Nickel Corp. [FAN-TSXV, FANCF-OTCQB, P21 FSE] said it has entered into an agreement to issue a $3.0 million senior unsecured debenture through a non-brokered debt private placement.

This strategic investment marks a significant milestone for the company, providing it with a non-dilutive source of capital to support the development of its Atlantic nickel project in Newfoundland.

The company said the debenture is the largest individual capital funding transaction in its history and contains favourable terms, including a 5.0-year deferral on all interest and principal payments. No equity securities will be issued to the lender on closing, ensuring that the company does not face any dilution.

The debenture is not required to be repaid until maturity in 2030, and the company said it is entitled to satisfy the annual interest obligations under the debenture by adding such amounts to the principal amount outstanding.

The shares were unchanged at 24 cents, Monday. The shares trade in a 52-week range of 32 cents and $0.065.

 First Atlantic is a Canadian mineral exploration company with a focus on developing its 100%-owned Atlantic Nickel Project, a large-scale nickel property located near existing infrastructure in Newfoundland.  The project’s nickel occurs as awaruite, a natural nickel-iron alloy containing approximately 75% nickel with no-sulfur and no sulfides. Awaruite’s properties allow for smelter-free magnetic separation and concentration, which could strengthen North America’s critical minerals supply chain by reducing foreign dependence on nickel smelting.

FPX Nickel Corp. [TSXV-FPX] is working to develop a greenfield discovery of nickel mineralization in the form of awaruite at its Baptiste nickel project in central British Columbia. Covering 245 square kilometres, it represents a promising target for bulk tonnage, open pit mining, the company has said.

First Atlantic said proceeds from the debenture will fund the fully permitted Phase 2 drilling program and preliminary metallurgical testing of the Atlantic Nickel Project as announced in a press release on January 15, 2025. The Phase 2 program aims to expand the strike length and width of the recently discovered RPM Zone, focusing on extending mineralization further east towards the historic Chrome Pond occurrence and north towards the Pipestone and Super Gulp targets. The goal of the phase 2 program is to define a larger area for resource drilling and prove continuity of nickel mineralization, highlighting the project’s significant potential to host substantial volumes suitable for commercial mining, the company said.

“We are thrilled to secure this significant $3.0 million non-dilutive financing on such favourable terms for our shareholders,’’ said First Atlantic CEO Adam Smith. The lender’s strong financial backing allows the company to maintain its rapid exploration and development pace following major awaruite nickel discoveries in our first drill program, which began in the fourth quarter of 2024, the company said.