Magna’s Crean Hill nickel project granted $500K

Magna Mining (TSXV: NICU; US-OTC: MGMNF) has been awarded $500,000 by the Ontario government for the company’s brownfield Crean Hill nickel-copper-platinum group metals project. The award is part of the Critical Minerals Innovation Fund launched by the province in 2022.

The funds, said Magna, will be applied towards metallurgical work related to enhancing precious metal recoveries from contact and footwall mineralization at Crean Hill, which was carried out as part of its 2024 surface bulk sampling program.

“We are extremely pleased to be the recipients of this funding program, and we are delighted that the Ontario government is supporting our efforts to develop new critical mineral production in Sudbury,” Magna Mining’s senior vice-president Paul Fowler stated in a news release.

Stephen Lecce, Ontario’s Minister of Energy and Mines, said: “We are helping to write the next chapter for Sudbury’s mining sector while powering Ontario’s future as a key supplier of the critical minerals.”

Shares in Magna Mining fell 2.6% to close at $1.68 apiece in Toronto, as wider markets gained on Tuesday, valuing the company at $329 million. 

Crean Hill mine

In addition to Crean Hill, Magna said it has plans to restart multiple new mining operations and increase copper and nickel production in Sudbury over the next three to four years.

Crean Hill is the site of a past-producing mine located in a historic nickel mining district of Sudbury. INCO (now Vale Canada) was its operator for three periods between 1900 and 2002, during which it produced more than 20 million tonnes of nickel-copper ore.

In 2022, Magna purchased the property from Lonmin Canada, and has since moved quickly through the pre-development process, filing its closure plan in the third quarter of 2023, and obtaining its final permits in April 2024.

Last September, the company released an updated economic assessment for the project, outlining a post-tax net present value (at an 8% discount) of $194.1 million and a 13-year mine life. The assessment was based on an NI 43-101-compliant mineral resource estimate of over 30 million tonnes, including 14.5 million tonnes of high-grade underground resources.

First production would come from test mining and bulk sampling, beginning with the 109 footwall deposit at surface then moving underground. For the first stage, Magna is expected to use Glencore’s (LSE: GLEN) Strathcona mill in Levack for processing and metallurgical testing.

The company also has an offtake agreement with Vale (NYSE: VALE) that would see initial production from Crean Hill sent to the Clarabelle mill nearby.