Black Hawk poised to take control of Union nickel-copper deposit

If the planned acquisition of China First Capital wins regulatory approval, Black Hawk Mining (TSE) will gain control of the Union nickel-copper deposit in Maine. Black Hawk has agreed to purchase 1.36 million shares (34%) of China First from Cliff Resources (TSE) as well as all of China’s outstanding debt (about $150,000) to Cliff. In addition, all shareholders of China First will receive one share of Black Hawk for 2.5 shares of China First. China First will then be amalgamated with a wholly owned subsidiary of Black Hawk, which will own 100% of the amalgamated company.

China First’s principal asset is a 100% interest in the Union nickel- copper deposit in Maine. The deposit was first discovered in 1965, but after drilling 139 holes from 1966 to 1974, low nickel prices convinced owner Hanna Mining to drop its option on the property. In 1989, China First drilled an additional 31 holes, totalling 10,900 ft.

According to Black Hawk, the deposit has probable reserves of three million tons grading 1.5% nickel and 0.66% copper to a depth of 450 ft., and is amenable to open pit mining methods. Black Hawk plans to conduct exploration and development of the Union deposit, expecting to put it into commercial production at a rate of 400,000 tons per year.