The Ring of Fire multi-metals district in the James Bay lowlands of northern Ontario is getting hotter for shareholders of Noront Resources (NOT-V, NOSOF-O), who have watched their shares surge 265% since the middle of June.

On Aug. 5 Noront reported the discovery of two new lenses of resource grade mineralization at its Eagle One deposit. That news followed reports a month earlier of "massive" chromite assay results at its Blackbird One and Two chromite deposits about 2 km away and next to its Eagle Two deposit.

Today Noront says it plans to raise $20 million in equity financing through a syndicate led by Wellington West Capital Markets. Flow-through shares of Noront will be offered at $2.80 on a private placement basis. The news sent Noront shares in mid-afternoon trading down about 8% on the day to $2.30.

The proceeds from the offering will pay for exploration on the company's McFauld's Lake project. Noront anticipates closing the financing in late August.

Noront is the dominant land holder at the Ring of Fire and continues to delineate and prove up its discoveries with NI 43-101 technical and economic reports and an aggressive drill plan this year.

Noront's Eagle One deposit can be described as forming part of a much larger ultramafic intrusion (the Ring of Fire intrusion) where disseminated sulphides encapsulate a lens of higher grade massive sulphides. The deposit remains open along strike and to depth.

With high nickel grades of between 6% and 7% within the massive sulphide zone of Eagle One, Noront believes it is possible to consider direct shipment of unprocessed ore to one of the existing concentrator/smelter facilities in the area. Operating cash flow from direct shipping would then be used to pay for an on-site concentrator and further exploration of the Ring of Fire area, the company noted in a corporate presentation in July.

According to a preliminary economic assessment of Eagle One, pre-tax payback could be reached in as little as 2.2 years with a pre-tax internal rate of return of 16% and a net present value of $464 million at a discount rate of 10%. The initial capital cost would be in the range of $173 million.

Eagle One has an indicated resource of 1.83 million tonnes grading 1.96% nickel, 1.18% copper, 1.12 grams platinum per tonne, 3.91 grams palladium per tonne and 3.81 grams silver per tonne. The inferred resource tallies 1.08 million tonnes grading 2.39% nickel, 1.27% copper, 1.37 grams platinum, 4.50 grams palladium and 4.21 grams silver.

Highlights from recently drilled holes include NOT-09-49, which intersected two lenses of mixed disseminated to massive sulphides under the Eagle One deposit (now referred to as Eagle 1A).

Eagle 1B (the first lens) located vertically under Eagle 1A returned 178.8 metres averaging 1.2% nickel, 0.5% copper, 0.9 gram platinum per tonne, 2 grams palladium including 2 metres averaging 2.5% nickel, 2% copper, 0.4 gram platinum and 4.7 grams palladium and 4.7 metres averaging 5.3% nickel, 1.3% copper, 0.6 gram platinum and 5.3 grams palladium.

Eagle 1C (the second lens) also located vertically under Eagle 1A and directly under Eagle 1B, returned 149.5 metres averaging 2.4% nickel, 1.1% copper, 1 gram platinum, 5.1 grams palladium including 23.7 metres averaging 5.2% nickel, 1% copper, 0.2 gram platinum and 7.9 grams palladium and 21 metres averaging 2.5% nickel, 1% copper, 0.4 gram platinum and 5.3 grams palladium.