Posted on 25 Nov 2024
Australian miner Alliance Nickel has announced a “robust” definitive feasibility study (DFS) and ore reserve update for its NiWest nickel-cobalt project in Western Australia, Kallanish reports.
According to the DFS, the project can produce an average of 20,000 tonnes/year of contained nickel and 1,600 t/y of contained cobalt over the first 12 years of operation. That’s around 90,000 t/y of nickel sulphate and 7,700 t/y of cobalt sulphate.
With a life-of-mine of 35 years, NiWest is planned to process higher grade ore for the first 27 years, followed by eight years of processing remaining previously mined and stockpiled low-grade ore.
The project’s post-tax net present value stands at AUD 1.5 billion ($975.5 million), with a pre-production capex of AUD 1.65 billion and a payback period of five years.
Its mineral resource estimate (MRE) now stands at 93.4m t at 1.04% nickel and 971,000 t of contained nickel at 0.07% cobalt. Around 83% of the resources are in the measured and indicated JORC category. The JORC-compliant ore reserve has been increased by 31% to 84.7m t at 0.94% nickel and 0.06% cobalt.
Alliance Nickel says the positive DFS outcome and its strategic partnerships position the company to capitalise on the transition in EV and battery storage markets. Early feedback from debt providers and Export Credit Agencies (ECAs) also indicates strong support for the project, it adds.
“The DFS results confirm that NiWest is low-cost, financially robust, with strong growth fundamentals and a clear market opportunity. The board has endorsed the DFS outcomes, and the company can now move to the next stages of implementation activities to meet the overall project development timeline,” says chief executive officer Paul Kopejtka.
Whilst the nickel market has experienced some volatility over the past year primarily due to oversupply from Indonesia, he firmly believes the long-term outlook for nickel remains positive. Nickel demand is expected to grow substantially over the next decade supported by the global adoption of EVs and broader electrification.
Kopejtka is also looking forward to finalising binding offtake agreements with global automaker Stellantis for the balance of the firm’s production and securing additional strategic equity investments.
A final investment decision on the project is planned for H2 2025. With a two-year construction lead, subject to financing and necessary approvals, first production is planned for late 2027.
The project is located at Murrin-Murrin in the North Eastern Goldfields of Western Australia, around 650 km northeast of Perth. The area is an established nickel and cobalt-producing region.
Source:Kallanish
