Name of the Project
Fisher East nickel project.

Location
The project is located north-east of Leinster, in Western Australia.

Client
Rox Resources.

Project Description
An updated scoping study has confirmed the strong economic and technical credentials of the project at a consensus projected forward nickel price. The updated study is based on the published mineral resource for the Camelwood, Cannonball and Musket deposits, which totals 4.2-million tonnes grading 1.9% nickel for 78 000 t of nickel.

The updated study is based on a mining rate of 500 000 t/y, resulting in the recovery of about
7 300 t/y of nickel and about 44 100 t of nickel-in-concentrate over the six-year mine life.

Two primary development scenarios have been considered – building a standalone concentrator or toll milling at a nearby operation. The concentrator case is based on building a concentrator plant on site with all the associated infrastructure.

The toll mill case is based on hauling run-of-mine ore to a nearby processing plant for toll treatment, and will require negotiation of an agreement with a third-party processing facility, which has not yet occurred.

The development of the concentrator will generate strong cash flows and competitive costs, while toll treating could be undertaken with significantly lower preproduction capital costs, and only slightly higher operating costs.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
In the concentrator case, the project has a pretax net present value (NPV), at a 10% discount rate, of A$79-million and an internal rate of return (IRR) of 44%, with a payback
of 2.3 years.

In the toll mill case the project has an NPV, at a 10% discount rate, of A$58-million and an IRR of 55%, with a payback of 1.8 years.

Value
Preproduction capital requirements are estimated at A$87-million in the concentrator case and at A$48-million in the toll mill case.

Duration
Not stated.

Latest Developments
Rox will pursue other opportunities identified in the scoping study, including an early-stage toll mill and using generated cash flow to fund the purchase and construction of a processing plant on site, opportunities to increase the size of the resource, optimising capital cost estimates, undertaking trade-offs studies on mining methods, and conducting additional metallurgical testwork to optimise and improve nickel recoveries.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Rox Resources, tel +61 8 9226 0044, fax +61 8 9325 6254 or email admin@roxresources.com.au.