BHP Billiton has acquired 11 per cent of Heron Resources in a move that highlights the mining and resources giant’s nickel aspirations in Western Australia.
The move comes after Heron recently announced development plans for its $1.4 billion Kalgoorlie laterite nickel project with Canadian joint venture partner, Inco.
BHPB paid $5.5 million for the stake to US-based OM Group in a move industry observers view as a strategic acquisition that will give BHPB a foothold in the local nickel industry.
Under the agreement with Inco, Heron is to earn 40 per cent of revenues from the project, with Inco to finance the $68 million cost of a feasibility study, arrange debt financing for the project and provide 95.5 per cent of any required equity.
The BHPB purchase sent shares in the junior up nearly 48 per cent to 68 cents.
BHPB is understood to have missed out when Inco became Heron’s partner in the project.
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