Pure Nickel Inc has released its operating highlights for the quarter and financial results for the 6 months ended May 31st 2010. Second quarter operating highlights”
MAN Alaska
The MAN Alaska property continued to be a main focus during the quarter. The property is currently operating under a joint venture agreement with Itochu Corporation of Tokyo. On March 25th 2010, Itochu exercised its right to vest a 30% interest in the property in consideration for having funded USD 6.5 million on exploration over the past two years, committing to a USD 7.5 million budget for 2010, and paying a USD 500,000 vesting fee. Two drills are currently turning and the 2010 summer drilling program is expected to complete approximately 8,000 metres. Additional geophysical surveys are being conducted contemporaneously and are being used to further define target selection.
Rainbow, Nunavut
Pure Nickel recently expanded the Rainbow property by 19 claims increasing the size of the property to 200 square kilometers. The property covers an anomaly which was discovered by Falconbridge-Noranda during a nickel exploration program in 2004 and was found to host several gold occurrences. One of the discoveries that was drill tested assayed 13.1 grams of gold per tonne over 2.14 metres. Pure Nickel is currently designing an exploration and prospecting field program.
Tower Extension, Manitoba
Rockcliff Resources Inc is proceeding to earn in to the Tower Extension VMS claims. This property is contiguous with Pure Nickel's William Lake claims in the Thompson Nickel Belt. For 2010, Rockcliff's plans are to initiate exploration to include the completion of gridding, a surface geophysical survey and a diamond drilling program of at least 2,500 metres.
Nuvilik, Quebec
During the quarter Pure Nickel was informed by Minergy Limited that it was terminating the option agreement for the Nuvilik property. The property is located in the central part of the Cape Smith Belt approximately 90 kilometers south of the coastal Inuit community of Salluit, and 80 kilometers west south west of the Raglan Mine complex. Pure Nickel is currently determining the next steps for the property.
Milford, Utah
Pure Nickel has an interest through a subsidiary in a copper property in Milford in Utah. The property is currently under option agreement to Western Utah Copper Company. In June, 2009, Pure Nickel filed an action for declaratory relief against WUCC in the United States District Court Utah, requesting interpretation of and the status and rights under the agreement. WUCC filed an answer and counterclaim, and in August, 2009, Pure Nickel filed a response to the counterclaim. The company believes that the counterclaim is without merit, and is of the opinion that the most likely outcome is that the claims will revert back to Pure Nickel. Failing that, Pure Nickel believes that the actions taken will ensure that the net smelter royalty agreement remains in place and is confirmed by the court. However, the outcome of litigation is always uncertain. On May 18th 2010, WUCC and its parent Copper King Mining Corporation filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code. Pure Nickel is ensuring that its interests are protected and is actively monitoring the process.
Results for the six months ended May 31st 2010:
Pure Nickel reported that at May 31st 2010, it had cash and short term investments of USD 5.7 million, up from USD 5.4 million at its November 30th 2009 year end. The company reported that its net loss was in line with expectations: USD 953,000 for the three months ended May 31st 2010 as compared to a net loss of USD 493,000 for three months ended May 31st 2009 and a net loss of USD 1,347,000 for the six months ended May 31st 2010 as compared with a net loss of USD 818,000 in the prior year. The increase in the loss from the prior year was as a result of the timing of certain bonus payments and stock option grants; other expenses were unchanged.
