Poseidon Nickel Ltd (ASX:POS) has reported that a scoping study looking into estimated CAPEX on refurbishment and operation of two processing plants at its Back Swan Project is now complete, with findings showing that both ore processing circuits can be “refurbished at a relatively low cost and in a relatively short period of time”.
The study, carried out by ASX-listed GR Engineering Services (ASX:GNG) delivered a number of positive findings including:
- 150ktpa Silver Swan circuit for treating high-grade sulphide ore: estimated to cost $13.4 million or $15.9 million, depending on the crushing option; and
- 1.1Mtpa Black Swan circuit for treating lower grade open pit disseminated ore and potentially ore from the Mt Windarra Nickel Project: estimated to cost $22.1 million
- Completion: approximately six months
“This creates wonderful optionality for our shareholders as it allows us to consider producing concentrate from our high-grade resources”
Management comments
Poseidon Nickel Director and CEO Peter Harold said: “The results from the Scoping Study demonstrate that both processing plants can be refurbished at a relatively low cost and in a relatively short period of time, i.e., approximately six months.
This creates wonderful optionality for our shareholders as it allows us to consider producing concentrate from our high-grade resources like Silver Swan and potentially Golden Swan, assuming the current resource drilling results in a maiden resource which can be converted to a reserve. The benefit of producing our own concentrate compared to selling ore would be the ability to obtain higher payability for the contained nickel and improve overall project economics. In addition, with a strong nickel price environment and positive outlook, it’s definitely time to review mining and processing of the lower grade Black Swan disseminated ore and potentially combining that feed with Windarra ore from Mt Windarra and/or Cerberus. These are certainly very exciting times for our shareholders.”
Images: Poseidon Nickel Ltd
