09:51 AM EST, 11/14/2016 (MT Newswires) -- Royal Nickel (RNX.TO) on Monday reported a wider net decline in the third quarter as the company's main Beta Hunt mine in Australia posted higher operating losses.

For the three months ended Sep. 30, 2016, Royal incurred an adjusted loss of $4.3 million or $0.02 per share, compared with a $1.6 million adjusted loss or $0.01 per share in the same period last year. In Q3, RNC incurred a net loss of $8.6 million or $0.03 per share, compared to a net loss of $1.5 million or $0.01 per share in Q3 2015. The net loss increase of $7.1 million is due primarily to higher expenses ($3.9 million), higher Beta Hunt mine operating loss ($3.5 million) and higher general and administrative expenses ($0.5 million), partially offset by Reed Mine operating income ($0.9 million).

Beta Hunt pre-commercial gold sales were 7,570 ounces, a 40% increase from 5,402 ounces in the prior quarter. The gold production ramp-up at the Beta Hunt Mine is expected to be complete by Q1 2017 and gold mined production is expected to reach 8,500-10,000 ounces during Q4 2016 and achieve an annualized gold production rate of 60,000 ounces during Q1 2017.

In order to provide an additional cash cushion until Beta Hunt becomes cash producing (expected early in Q1 2017), the company entered into a US$2.5 million unsecured debt facility arranged by Riverfort Global Capital.

"RNC achieved a number of milestones during the quarter with another strong quarter from the Reed Mine, exciting high grade gold-copper discoveries at our Qiqavik project, and the replacement of the Lascaux financing facility and its 3% NSR on gold production from Beta Hunt with a comprehensive financing solution," said company president Mark Selby. "This financing provides near-term operating flexibility (no repayments until February 28, 2017) and a low cost working capital facility that will support our aggressive ramp-up of mine exploration and production. Unfortunately, mined gold production from Beta Hunt came in lower than expected during the quarter as one-time issues in two stopes emerged late in the quarter and resulted in lower grades and lower volumes than expected."

Selby noted that management at the Beta Hunt Mine was replaced in October and the new leadership has already accelerated development to achieve targeted annualized gold production rates of 60,000 ounces per annum early in Q1 2017.

RNX shares gained 1.5% in early trading to $0.32.