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BHP and Noront terminate support agreement

Noront Resources Esker Camp (Credit: Noront)

The world’s biggest miner, BHP (ASX, LON, NYSE: BHP), has announced the termination of the support agreement between BHP Lonsdale, its subsidiary BHP Western Mining Resources and Noront Resources (TSXV: NOT) relating to Noront’s support of BHP Lonsdale’s C$0.75 per share offer to acquire Noront, officially ending a long-dragged battle for the Canadian nickel miner.

In accordance with the terms of the Support Agreement, Noront has made a C$17.78 million ($13.8m) termination payment to BHP WMR.

Noront Resources said on Tuesday it has chosen to go with the latest bid put forward by Australian billionaire Andrew Forrest’s Wyloo Metals, giving BHP five business days to match the offer. BHP said later in the day it did not see “adequate long-term value” in raising its C$0.75 a share bid to match Wyloo’s.

The two Australian mining companies had been engaged in a tug of war with competing offers for Noront since July. At stake is the takeover target’s early-stage Eagle’s Nest nickel and copper deposit in the ‘Ring of Fire’ in northern Ontario. 

The asset has been billed by Wyloo as the largest high-grade nickel discovery in Canada since the Voisey’s Bay nickel find in the eastern province of Newfoundland and Labrador.   

Eagle’s Nest is expected to begin commercial production in 2026 with the mine running initially for 11 years. 

The mine’s start date has repeatedly been pushed back by Noront due to successive federal and provincial governments’ inability to consult and reach a unanimous agreement with First Nations in the area. 

Forrest, chairman and founder of iron ore producer Fortescue Metals Group (ASX: FMG), plans to lead a new board of directors at Noront.