Poseidon Nickel has purchased the dormant Black Swan nickel mine and concentrator 53 km northeast of Kalgoorlie, Western Australia, from Norilsk Nickel for A$1.5 million and is considering restarting the concentrator to process 500,000 mt/y of Black Swan ore and 600,000 mt/y of ore from its Mount Windarra project near Laverton, Western Australia.

Norilsk placed the Black Swan operation on care and maintenance in February 2009. When Poseidon announced the purchase in early July, the company said it had the option of recommissioning the plant in its current location and trucking ore to the plant from Mount Windarra or relocating the plant to Mount Windarra. The current location has the benefits of being connected to the power grid and a nearby workforce in Kalgoorlie.

The Black Swan deposit has a reported mineral resource of approximately 26.3 million mt grading 0.70% nickel for 185,800 mt of contained metal at a 0.4% nickel cut-off grade. Poseidon has awarded Golder Associates a contract to undertake additional analysis of the resource base, with the intention of reporting a mineral resource estimate to JORC 2012 guidelines. The work includes reviewing in-pit resources, as well as ore currently stockpiled on the run-of-mine pad but not presently included in the project's resource model.

Golder will also seek to verify the condition of the current tailings dam. Poseidon believes that the dam has several years of remaining capacity at intended throughput rates before a wall lift will be required but wants to have that belief verified.

Poseidon also has commissioned GR Engineering Services to develop a detailed scope of work, cost estimate, and schedule for restarting the processing plant, and has commissioned Simulus Engineers to produce an overall integrated operational mining study for the combined Black Swan and Windarra project.

Poseidon CEO David Singleton de-scribed the Black Swan acquisition as offering the opportunity to place the Mount Windarra project into production at a much lower capital cost than previously anticipated. It also more than doubles Poseidon's nickel resource base.

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