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  • Estrella Resources (ESR) kicks off a resource confirmation drilling program at its Spargoville Nickel Rights project in WA
  • The drilling is designed to help Estrella complete a definitive feasibility study (DFS) for the 5A nickel mine
  • Estrella plans to drill 17 holes in the area to aid in final ore reserve calculations, metallurgical characteristics and final mine design parameters
  • This comes after the company withdrew its intention to sell the Spargoville project, citing the current strength of the nickel market for the change of heart
  • ESR shares are down 3.57 per cent to 2.7 cents each at 11:19 am AEST

Junior explorer Estrella Resources (ESR) has kicked off a resource confirmation drilling program at its Spargoville Nickel Rights project in WA.

The company today said drilling contractor Top Drive Australia (TDA) has mobilised on-site to begin drilling at the 5A nickel mine in the area.

The drilling is designed to help Estrella complete a definitive feasibility study (DFS) for the 5A nickel resource.

This comes after Estrella withdrew Spargoville from sale despite having already received several offers for the project from prospective buyers. According to Estrella, the recent strength of the nickel market — with prices touching 15-year highs — made the company re-evaluate the project and decide it was no longer for sale.

Managing Director Chris Daws said the 5A mine, which lies near WA’s nickel sulphide district at Kambalda, represented an early nickel-producing opportunity for the company.

“With the re-start of the Kambalda Nickel Concentrator at Kambalda by BHP-Billiton to treat third-party ores, the location and timing of developing 5A are obvious,” Mr Daws said.

“Our relationships with drilling and mine service groups are aiding in our efforts to make the most of what we have in the backdrop of an incredible nickel market.”

Although not all of the 5A resource will be able to be mined and recovered within the open-pit cutback, the company said it believed a substantial portion would fall into the ‘economic’ category of the DFS to be mined, processed and sold.

The company will be completing approximately 17 diamond holes into the 5A mine resource area to aid in final ore reserve calculations, metallurgical characteristics and final mine design parameters.

Drilling is expected to take four to six weeks to complete as the hole lengths will be relatively short to reach the anticipated maximum new 5A pit design depth.

Assays for nickel intersections will be fast-tracked through the laboratory to aid in the speed of the completion of the DFS, mine planning and permitting.

ESR shares were down 3.57 per cent to 2.7 cents each at 11:19 am AEST.

ESR by the numbers
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