Lowell Resources Fund steps up to 10 per cent stake in Western Mines

Western Mines Group has strengthened its balance sheet with a $2.74M capital raising, securing Lowell Resources Fund as a cornerstone backer as the company pushes ahead with exploration and development work at its flagship Mulga Tank nickel project in WA’s eastern Goldfields.

The placement attracted strong support from investors and was led by the Melbourne-based fund manager which tipped in $2M and will emerge as Western Mines’ largest shareholder with a 10.6 per cent stake.

The raise was completed at 16.3 cents per share and will see the company issue 16.82 million new shares. Existing major shareholder Equentia Natural Resources participated to maintain its position on the register, while several top-20 shareholders also backed the deal.

One notable feature of the transaction is a $1M equity swap arrangement between the Western Mines and Lowell. As part of the deal, the ASX-listed nickel explorer will receive 499,002 Lowell Resources Fund units worth $1M, making it a top-10 holder in the listed investment company, while Lowell takes an equivalent parcel of Western Mines shares. Those shares will be locked away under a 12-month escrow.

Management says the fresh cash will be directed squarely at advancing Mulga Tank, including a planned seismic survey, additional reverse circulation and diamond drilling programs, ongoing geochemical work and completion of the project’s initial scoping study.

The funding comes as Western Mines continues to build momentum at Mulga Tank, already recognised as Australia’s largest nickel sulphide deposit, with a mineral resource estimate sitting at a monster 1.968 billion tonnes grading 0.27 per cent nickel for more than 5.3 million tonnes of contained nickel.

We’re pleased to welcome Lowell Resources Fund as our new largest shareholder, holding just over 10% of the Company, and the Board is once again grateful for the ongoing support from our existing shareholders, with a number of Top 20 holders, including Equentia, taking part in the raise.

Earlier this month the company reported encouraging progress from its Phase 5 drilling campaign, saying that all of the first 10 reverse circulation (RC) holes intersected visible disseminated sulphide mineralisation.

A key focus of the program has been follow-up drilling around a standout RC hole from the company’s earlier Phase 3 campaign. That hole delivered what the company hailed as the best high-grade hit ever drilled at Mulga Tank, returning 193m grading 0.33 per cent nickel.

Encouragingly, the follow-up holes intersected further sulphide-rich zones, including intervals approaching stringer to semi-massive sulphide textures. And although laboratory assays are still to come, the visual observations continue to point to the potential for higher-grade nickel sulphide mineralisation within the project’s enormous resource base.

Western Mines is preparing to launch a WA Government-supported seismic survey across its Mulga Tank complex, designed to map its three-dimensional architecture and help target potential Perseverance-style massive nickel sulphide accumulations.

With a substantially stronger treasury, a major new institutional supporter on the register and a busy exploration schedule ahead, Western Mines looks well placed to keep probing one of Australia’s most intriguing large-scale nickel sulphide systems.

For small explorers, fresh funding is generally at least half the battle. Now, with Lowell’s endorsement and a fully funded work program squarely in sight, Western Mines has given itself plenty of firepower to keep unlocking the scale and potential of Mulga Tank.

Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au