European Nickel announced in December 2010 it had placed its Çaldağ project in Turkey on care and maintenance until receipt of a necessary forestry permit and that it will fast-track the definitive feasibility study for its Acoje nickel laterite project on Luzon Island in the Philippines. The Çaldağ technical team will be transferred to the Acoje project.
The definitive feasibility study for the Acoje project has been in progress since March 2009. A heap leach trial will begin during the first quarter of 2011. According to the company, a significant amount of the metallurgical information developed and compiled at Çaldağ is also transferable to the Acoje definitive feasibility study.
A positive prefeasibility study confirmed an economically viable nickel heap leach project at Acoje. The base-case scenario calls for an operation producing 24,500 mt/y of nickel mixed hydroxide product over an initial 10-year mine. Conversion of current inferred resources to indicated resources offers significant potential to extend the mine life. The pre-feasibility study estimated the Acoje project’s net present value at $586 million at a discount rate of 10% and its internal rate of return at 37.2%, using a long-term prices of $7/lb for nickel and $10/lb for cobalt.
Commenting the company’s plans, Managing Director Rob Gregory said, “European Nickel is determined to become a nickel producer through capitalizing on our low-cost, heap leach technology. While we are disappointed that, despite repeated assurances, the forestry permit for the Çaldağ project has yet to be re-issued, we do have an equally viable alternative project in Acoje which has the potential to be significantly larger and longer life than Çaldağ. We cannot tread water indefinitely at Çaldağ until the permit is re-issued. The board believes our efforts and resources are better deployed at Acoje in the meantime.”
European Nickel also reported that, by mutual agreement, the Çaldağ off-take contract with BHP Billiton for 100% of the mixed hydroxide product has been terminated.