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PERTH (miningweekly.com) – ASX-listed nickel developer Sirius Resources was hoping to secure an offtake partner for its A$473-million Nova nickel mine, in Western Australia, before the end of 2014.
Sirius executive director Jeff Foster said the mine was expected to be fully permitted by the end of the year. The company was awarded a mining lease for Nova in August.
“On the key issues of financing and offtake, we are finalising debt finance for Nova and aim to have financial close by December,” Foster said.
“Our offtake discussions are at an advanced stage with strong competition and good terms on the table and our expectation is to have the first of these offtake contracts in place also by the end of December.”
The development schedule for Nova would see construction of the mine start early in 2015. First ore is expected in the second quarter of 2016 and first concentrate six months later.
A recently completed definitive feasibility study (DFS) on the Nova project estimated that it could generate net cash flow of A$2.74-billion from a nickel revenue of some A$4.53-billion, over the project’s ten-year mine life.
The DFS was based on a processing rate of 1.5-million tonnes a year, to deliver about 26 000 t/y of nickel, 11 500 t/y of copper and 850 t/y of cobalt over a ten-year mine life.
Foster said that the project remained financially robust with a low estimated C1 cash cost of A$1.66/lb and an all-in sustaining cost of A$2.32/lb concentrate, which positioned Sirius in the lowest quartile of global producers while minimising the downside risk.
“In other words, more than 75% of nickel mines worldwide would have to be losing money before Nova does,” Foster said.
“This robustness makes Nova more ‘cycle proof’ than most nickel mines globally.”