Nicola Mining to buy gold-silver concentrate from Ocean Partners

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Nicola Mining Inc. [NIM-TSXV; HUSIF-OTC] signed a purchase contract for gold and silver concentrate with Ocean Partners U.K. Ltd., a company that provides global trading services to miners, smelters and refiners. The purchase contract also includes a revolving US$500,000 prepayment provision that allows Nicola to request an advance prepayment for the purpose of working capital and has entered into the purchase contract with the expectation of commencing milling activities at its Merritt Mill in southwestern British Columbia.

On April 26, 2021, Nicola requested a prepayment of US$250,000, which was received on April 27, 2021. Funds are expected to be allocated towards preparing the mill for production and potential acquisitions. Terms of the prepayment are 3M LIBOR plus 5.5% per annum, plus a fee of US$5,000 on the first prepayment. The company will make interest payments for the first six months and repay the principal in October of 2021, at which time it may again utilize the full US$500,000 prepayment provision.

The non-dilutive Prepayment allows Nicola to complete CAPEX investments and bridge the period between restarting the mill and cash flow. It is not a net smelter return and there is no obligation by the company to continue payments once the drawn down amount has been repaid. Peter Espig, CEO of Nicola, commented, “We are very excited about the opportunity to work with Ocean Partners and the access it provides to non-dilutive funding options, as well as mitigating the requirement to enter into an NSR agreement. We also recognize the potential of project-consolidation that our fully-permitted and modern $30 million mill provides, but also remain cognizant that the company’s greatest long term value lies in our [nearby] wholly-owned New Craigmont Copper Project, upon which we are about to commence our 2021 Exploration Program.”

Brent Omland, CFO of Ocean Partners, commented, “We recognized the significant CAPEX and long term commitment required for projects to garner a mill permit in British Columbia. We believe that Nicola has the province’s leading site permitted to accept high-grade gold and silver mill feed from throughout British Columbia and we look forward to a long term relationship.”

Scientific and Technical Information

Ocean Partners operates in a number of countries around the world.


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