PERTH (miningweekly.com) – Nickel miner Western Areas has reported an increase in production for the December quarter as the development of its Odysseus mine continued to ramp up, following first production in October.
Nickel mined during the quarter increased from the 3 741 t mined in the September quarter, to 4 200 t, while nickel-in-concentrate production increased from 3 804 t to 4 025 t in the same period.
The miner on Thursday said that production increases from the Forrestania operation were underpinned particularly by an improved performance at Spotted Quoll, together with slightly higher mill throughput and recoveries.
Spotted Quoll accounted for 3 123 t of nickel produced during the quarter, while Flying Fox contributed 1 077 t of nickel.
The Cosmic Boy Concentrator processed 151,417 t of ore at an average grade of 3.1% nickel for a total of 29 582 t of concentrate grading 13.6% nickel, resulting in 4 025 nickel tonnes produced at a recovery of 86.0% and an average concentrator availability of 97.5%.
Western Areas noted that several external power supply outages occurred resulting in nearly 50 hours of unplanned downtime during the quarter. To compensate, the planned December maintenance shutdown was re-scheduled to mid-January to coincide with a further major Western Power shutdown.
Meanwhile, development of the Odysseus mine continued to ramp up during the quarter, and preferred parties for final discussions regarding Cosmos nickel offtake for the initial two years of Odysseus’ production have been shortlisted.
“Development at Odysseus has ramped up considerably and we significantly de-risked the future development schedule for the project during the quarter. We also made positive progress in continuing to bolster the high-potential AM6 and Mt Goode deposits, which provide significant upside value potential at Odysseus,” said Western Areas MD Dan Lougher.
“In tandem with this, we have entered the final stages of the Cosmos nickel offtake tender process, for the initial two years of Odysseus’ production, following substantial market interest. It was also very pleasing to see mine production from Forrestania increase by over 12% during the quarter, principally on the back of increased production at Spotted Quoll, enabling us to capitalise on the robust nickel price environment.”
Western Areas in December entered into a scheme implementation deed with ASX-listed IGO, under which IGO will acquire 100% of the share capital of Western Areas by way of a scheme of arrangement, subject to shareholder approval and in the absence of a superior proposal.
Under the terms of the scheme, Western Areas shareholders will receive A$3.36 per Western Areas share in cash, which represents a 35.5% premium to the company’s undisturbed share price of A$2.48 per Western Areas share on 18 August 2021.
Mining magnate Andrew Forrest’s Wyloo Metals took an initial 5.28% stake in Western Areas, just a day after initial talks with IGO were announced. The company earlier this week invested a further A$31.4-million into purchasing Western Areas shares, taking its stake in the miner to 9.14%.
IGO’s offer for Western Areas requires a 75% acceptance from shareholders.