PERTH (miningweekly.com) – An increase in the cobalt price has prompted ASX-listed Metals X to revisit its Wingellina nickel/cobalt/scandium project, in Western Australia.

A previous feasibility study into the Wingellina project estimated that the project could deliver about 40 000 t/y of nickel and 3 000 t/y of cobalt over a mine life of 40 years, with capital costs estimated at A$2.5-billion.

At nickel prices of $20 000/t of nickel and $40 000/t of cobalt, the feasibility study estimated a net present value of A$3.4-billion and production costs of $3.34/lb of nickel, after cobalt credits.

Metals X MD Warren Hallam told delegates at the Paydirt nickel conference on Tuesday that the company had initially been speaking with possible joint venture partners to fund A$1-billion of the project funding, with the balance to be financed.

However, the project was placed on the backburner following a fall in nickel prices.

Hallam added, however, that the recent significant increase in the cobalt price, combined with the potential ability to directly produce nickel and cobalt sulphates for the battery industry, was expected to substantially improve the project economics at Wingellina.

The company has now started further studies at the project area, aimed at optimising a number of high-grade cobalt/nickel openpits, and to undertake additional testing for the production of cobalt sulphate and nickel sulphates as feedstock for the battery industry.

“Wingellina remains one of the world’s largest undeveloped nickel, cobalt and scandium deposits. We already have the approvals and a reserve that is sufficient in scale to support decades of production,” Hallam said.

“As with other similar projects, we are able to use resins for extracting and recovering cobalt and nickel to produce nickel and cobalt sulphates for battery manufacturing. The main differentiating feature with Wingellina is the grade is higher and the resource is significantly larger than most cobalt-hosting projects currently being touted in the market.”

Wingellina, also known as the Central Musgrave project, is estimated to host a mineral resource of about two-million tonnes of nickel and 154 000 t of cobalt, and an ore reserve of about 1.56-million tonnes of nickel and 123 000 t of cobalt.

A number of key approvals for the Wingellina project were already in place, including a mining agreement with the Native Title Holders, and environmental approvals, which were awarded in late 2016.