- Poseidon Nickel (POS) completes a scoping study for the Lake Johnston nickel project to assess the capital and operating costs to refurbish and operate the ore processing plant and associated infrastructure
- It estimated roughly $31 million in capital costs over a seven-month period which the company described as “a fraction” of what it would take to start from scratch
- Operating costs are estimated at $36.04 per tonne at a processing capacity of 0.9 million tonnes per annum
- POS is also focused on restarting its Black Swan nickel project but says both allow it to achieve its nickel production target of 15,000 tonnes of nickel concentrate per annum
- Company shares are up 4.30 per cent to trade at 9.7 cents
Poseidon Nickel (POS) has completed a scoping study for the Lake Johnston nickel project which was placed on care and maintenance in 2013.
The scoping study was completed by GR Engineering Services (GRES) who assessed and outlined the estimated capital and operating costs to refurbish and operate the Lake Johnston ore processing plant and associated infrastructure.
Ore will be treated through the existing crushing, grinding and flotation circuit of the Lake Johnston plant to produce a nickel concentrate.
Including engineering, procurement, construction and management costs, refurbishing the WA-based project is expected to cost roughly $31 million. The estimated refurbishment schedule is seven months which assumes power can be supplied and installed within this period.
What isn’t included in the capital cost estimate is power supply, conveyor covers and painting of the blast and prime.
In terms of operating costs, GRES estimated $36.04 per tonne at a processing capacity of 0.9 million tonnes per annum. The per tonne cost includes power, maintenance spares and consumables, operating consumables, labour, and other costs.
Managing Director and CEO Peter Harold was pleased with the outcome of the scoping study.
“Similar to the Black Swan project, the estimated refurbishment costs and time are a fraction of what it would take to build a new processing plant and the associated infrastructure such as the 200 person village, tailings dam, airstrip, etc.,” he said.
Poseidon assured it’s focused on restarting the Black Swan project, also located in WA, the Lake Johnston project could be restarted once Black Swan is in operation. This would effectively allow the company to expand its nickel production and achieve its target of at least 15,000 tonnes of nickel concentrate per annum.
The company will now begin an ‘aggressive’ exploration program to increase Lake Johnston’s resource base.
POS shares were up 4.30 per cent to trade at 9.7 cents at 12:42 pm AEDT.