Name of the Project
Black Swan nickel operations restart project.

Location
Kalgoorlie, in Western Australia.

Client
Poseidon Nickel.

Project Description
The mine has 16 200 nickel tonnes derived from measured and indicated material and other modifying factors, such as dilution, which represents 70% of the mine plan, or 82% sulphide ore tonnes.

The mine plan also includes additional inferred material, which is outside of probable reserves. This amounts to 30% of the nickel tonnes of the mine plan, or 18% of the processed sulphide ore tonnes.

A feasibility study has confirmed that the Black Swan operations – the Black Swan openpit mine, the Silver Swan high-grade underground mine, the Black Swan sulphide concentrator and supporting infrastructure – can be brought back into operation at a low level of capital investment and that no regulatory or technical barriers exist.

The study envisages production of about 8 000 t/y of nickel in a smeltable grade concentrate from the Black Swan process plant and direct shipping ore from the Silver Swan underground mine. Ore previously mined and currently stockpiled at Black Swan will be processed at Black Swan. Combined mill feed will average 1.1-million tonnes a year, compared with process plant capacity of 2.2-million tonnes a year, which will be able to process third-party feed on a toll treatment basis or buy at the gate under contract terms.

Several mines within the Kalgoorlie region will come out of contract and the opportunity exists to competitively bid for the ore. The project has a mine life of 3.1 years, with several promising extensions to be considered.

Potential Job Creation
An estimated 180 jobs will be created on site.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 10% discount rate, of $43.6-million and an internal rate of return of 92%.

Value
Total project capital requirements are estimated at $56.66-million, including plant and mines refurbishment and development.

Duration
The feasibility study has confirmed that the operations can be brought back into operation, with first production within 12 months of fully funding the project.

Latest Developments
The Black Swan nickel operations have been on care and maintenance, and all assets remain in good standing. Minor deterioration of the plant is evident and previously stockpiled nickel ore has been thoroughly tested to confirm nickel recovery and concentrate quality.

Underground mining contractor tenders have been received and are under review.

Poseidon expects to appoint an underground contractor to begin early works at Silver Swan.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Poseidon Nickel, tel +618 6167 6600, fax +618 6167 6649 or email admin@poseidon-nickel.com.au.