Name of the Project
NiWest nickel/cobalt project.

Location
Adjacent to Glencore’s Murrin Murrin operation, in the north-eastern goldfields of Western Australia.

Project Owner/s
Alliance Nickel, formerly GME Resources.

Project Description
An updated feasibility study has confirmed the robustness of a long-life operation producing high-purity nickel and cobalt sulphate products, to be delivered to lithium-ion battery raw material markets.

The mine and process schedule remain unchanged for the 2018 prefeasibility study (PFS). The PFS proposes conventional openpit mining at a low strip ratio of 2:1.

Envisaged is a 27-year mining operation with a nameplate ore throughput of 2.4-million tonnes a year, resulting in total production of 456 000 t nickel (in nickel sulphate) and 31 400 t cobalt (in cobalt sulphate). Projected steady-state nickel and cobalt recoveries are estimated at 79% and 85% respectively.

Average production over the first 15 years is expected to be 19 200 t/y nickel and 1 400 t/y cobalt.

The processing route selected is heap leaching followed by neutralisation, impurity removal, direct solvent extraction and crystallisation to produce nickel and cobalt sulphate products.

Forecast operating and capital costs have been re-estimated through further prospective supplier interaction and general inflationary scaling.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The updated PFS presents three financial projections.

In Case 1, the project has a net present value, at an 8% discount rate, of A$1.88-billion and an internal rate of return of 21.6%, with a payback of 4.4 years.

In Case 2, the project has a net present value, at an 8% discount rate, of A$2.6-billion and an internal rate of return of 25.9%, with a payback of 3.7 years.

In Case 3, the project has a net present value, at an 8% discount rate, of A$3.31-billion and an internal rate of return of 29.7%, with a payback of 3.3 years.

Capital Expenditure
Preproduction capital expenditure has increased from A$966-million in the 2018 PFS to A$1.26-billion in the updated PFS.

Start/End Date
Construction is expected to take 24 months from the final investment decision, with the forecast heap pad and plant ramp-up phase taking about 20 months.

Latest Developments
Alliance Nickel has signed a binding offtake and share subscription agreement with automotive maker Stellantis NV over the NiWest nickel and cobalt project.

Under the terms of the agreement, Alliance, formerly known as GME Resources, will supply about 170 000 t of nickel sulphate and 12 000 t of cobalt sulphate over an initial five-year offtake term, amounting to about 40% of the future annual forecast from NiWest.

The offtake agreement is subject to the successful startup of commercial production, product qualification and other clauses.

In addition, Stellantis will subscribe for A$15-million in new shares in Alliance, at 18c each, giving the company an 11.5% shareholding in Alliance and the right to nominate a director to the Alliance board.

The placement will be undertaken in two tranches, with the first consisting of 70.6-million shares to be issued under the company’s existing capacity. The second tranche of about 12.73-million shares is subject to Australian Foreign Investment Review Board approval, which is expected in the June quarter.

Completion of the share subscription agreement is conditional upon the binding offtake agreement not being terminated by Alliance.

Funds raised in the placement will go towards completion of the definitive feasibility study and engineering design works for the NiWest project.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
GME Resources, tel +61 8 9336 3388, fax +61 8 9315 5475 or email enquiries@gmeresources.com.au.