RNC Minerals ups exposure to near-record Aussie gold price

RNC Minerals (previously Royal Nickel Corp) (TSE:RNX) move into primary gold mines took another step forward on Friday with the announcement of a comprehensive debt refinancing package for the ongoing ramp-up and development of the 100% owned Beta Hunt Mine in Western Australia.

In a research note Haywood Securities said  the financing solution "provides near-term operating flexibility (no repayments until February 28, 2017), a low cost working capital facility that will support mine production and exploration ramp-up, and exposure to near-record Australian dollar gold prices. In contrast, the previous facility swept 100% of Beta Hunt’s cash flow to repay a 9.5% loan."

RNC stock price is up 122% so far this year for a market value of $110 million in Toronto thanks to its Beta Hunt acquisition in May and as a resurgent nickel price underpins its operating assets.

In September RNC also closed on $9.2 million in financing as it ramps up and development of its 100%-owned Beta Hunt gold and mine in Australia, which RNC acquired in May this year. Well-know mining financier Eric Sprott participated in the equity financing and now owns around 10% of the company.

RNC is targeting total 2016 gold production of 35,000 to 45,000 ounces and the mine located in West Australia is expected to reach an annualized run-rate of around 60,000 in early 2017.

RNC principal asset is the permitted Dumont Nickel project located in the established Abitibi Mining camp in Quebec. The company also owns an interest in the advanced stage nickel exploration Aer-Kidd project near Sudbury, Ontario, a 68% stake in West Raglan – an advanced high grade Ni-Cu-PGM property located in northern Quebec via its holding in True North Nickel – and a 30% interest in the Reed Mine copper and gold mine in Manitoba through its 30% interest in VMS Ventures.