Thursday, 11 September 2008

Pure Nickel - Joint Ventures Proving Value

Pure Nickel (TSX: NIC)
Basic Shares: 67.8 million
Fully Diluted: 92.4


The goal for any junior exploration company is to ensure its success, continuously drilling to define value in the property that the company owns. When a company holds as much property as Pure Nickel in its portfolio, it would take years to explore everything it owns by itself.

In comes the joint venture -this week Pure Nickel released two separate news releases based on drilling results from partners that are actively exploring on its property. This proves value to the shareholder as it increases its chance for success and costs the company nothing out of pocket.

Pure Nickel, along with its partner Crowflight Minerals Inc., announced that it has discovered two nickel zones just 400 meters south of the past producing Manibridge Mine at its Manibridge property. The assay reports are in from its 6 hole, 2500 metre program and nickel has been found with percentages as high as 1.51%. More drilling will commence in order get an idea of the resource potential on this property but the results so far are encouraging.

Today, the joint venture with Manicouagan Minerals announced findings of nickel up to 2.35% and 1.35% copper on its HPM/Forgues property in Quebec. To date Manicouagan has drilled 11 holes and a total of 2,345 metres. Exploration is currently continuing on this property.

See full news release here...

The elephant in the room is the market and the decimation of the stock prices of almost every junior exploration company. This grief may last for quite some time. A key point for people to remember is that raising equity in this environment is pretty much a non-starter. While NIC's stock price has also taken it on the chin, the simple fact is that the company has very good JV's and approximately $6 million in cash so it is not in a squeeze. Ultimately, the market while ignoring all juniors at this moment, will begin to focus on companies that cannot only make it through this perfect storm but hold properties of merit combined with sound business management.