KIRKLAND LAKE, ONTARIO -- (Marketwire) -- 03/11/13 -- NORDEX EXPLOSIVES LTD. (TSX VENTURE: NXX) ("Nordex") is pleased to announce a memorandum of understanding agreement has been reached with Wahgoshig Limited Partnership through its general partner Wahgoshig Resources Inc. pursuant to which the parties have agreed to enter into a working relationship which is expected to be structured as a limited partnership.
Through such working relationship, both Nordex and Wahgoshig intend to pursue business opportunities with those customers operating in the mining, quarry and construction industries with which Wahgoshig have a working agreement and which have a need for the use of explosive products, accessories and related services.
Wahgoshig has agreed to work with Nordex in an exclusive manner to pursue the explosive business of those customers which require the supply of explosive products, accessories and related services in the geographic territory where the Wahgoshig First Nation holds "territorial rights".
In addition to this new relationship with Wahgoshig, Nordex previously announced its intention to enter into a working relationship with the Wabun Tribal Council through the formation of a limited partnership expected to be known as "Niimki Explosives".
These agreements/relationships, are subject to the completion of definitive documentation and the requisite corporate, regulatory and TSX Venture Exchange approvals and are intended to develop and create new opportunities for both Wahgoshig and Wabun First Nation businesses and members.
The "territorial rights" of our new First Nation partners covers a large land mass comprising most of Northeastern Ontario including the well known Timmins and Kirkland Lake mining camps which represent the heart of the gold mining industry in Canada.
Jim Taylor, President & CEO, stated, "We are very excited about working with both Wabun and Wahgoshig as we share many of the same objectives and goals with regard to the development of Northern Ontario and the protection of our collective interests and rights. Nordex is committed to the future of Northern Ontario and as a local Company appreciates the importance of our environment and resources and supports the principal that their use should be to the benefit of the people and communities of the North. We are very proud of the fact Nordex is the only truly Canadian explosive company manufacturing products in Canada for the benefit of Canadians."
The above agreements create many new opportunities for Nordex which also recently announced the opening of a new strategic distribution site. The site is located in the Muskoka Region of Ontario. It is estimated the market potential within a 200 kilometer radius from this location could be up to $25,000,000 in annual explosive sales to key quarry, construction and mining companies. There can be no assurances that Nordex will be able to win a significant portion of this business. The site is the first of at least two such locations expected to be added by the end of 2013.
Nordex also recently announced it closed its previously announced non-brokered private placement offering of common shares on November 12, 2012 and December 10, 2012. The offering was oversubscribed with the Company issuing 10,132,976 shares at a price of $0.45 per share to raise gross proceeds of $4,559,840. The net proceeds will be used to fund investment in the Company's distribution system and for additional working capital.
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