Commercial mine development and surface construction is expected to start during the December 2020 quarter at Kambalda Nickel Operations. (Photo: Mincor Resources)
Mincor Resources NL has approved the development of its 100% owned Kambalda Nickel Operations (KNO) in Western Australia. The final investment decision for the planned recommencement is supported by a credit approved terms sheet to provide a secured $55 million project finance facility.
The facility, together with the company’s existing cash reserves of more than $100 million, will allow Mincor to execute the delivery of its nickel restart plan in line with the Definitive Feasibility Study (DFS) announced in March, the company said.
The DFS outlined an initial five-year operation with preproduction CAPEX of $68 million and a peak funding requirement of $97 million. KNO is forecast to produce 71 kt of nickel and 5 kt of copper on a life-of-mine basis.
The funds will be used toward project development and working capital during the construction, commissioning and ramp-up phases at KNO.
With funding now materially advanced and board approval in place, Mincor has issued a “notice to proceed” to its underground mining contractor, Pit N Portal, in line with the binding contract executed in May.
Pit N Portal has 60 calendar days to plan and mobilize for commencement of the contract. There are already several Pit N Portal personnel on site following the commencement of an early works program.
With all required key environmental and state government permitting in place to commence, Mincor anticipates that mobilization will ramp up over the coming weeks, with commercial mine development and surface construction expected to start during the December 2020 quarter.
Subject to unforeseen delays, Mincor said it is targeting commencement of ore production early in the December 2021 quarter. First ore delivery to the BHP Nickel West Kambalda Nickel Concentrator and first nickel concentrate production is expected in the March 2022 quarter.
On a life-of-mine basis, the DFS completed earlier this year estimated total capital expenditure of approximately $179 million, with the operation expected to generate around 200 long-term jobs during operations.
“It is a great honor to be announcing a Final Investment Decision, which heralds Mincor’s return to nickel mining in Kambalda after a hiatus of some four years,” Mincor Managing Director David Southam said. “We are now on the cusp of realizing our vision to resume profitable and sustainable nickel sulphide mining in the Kambalda district, and to do so in an environmentally responsible and ethical manner that will see this great nickel province return to the forefront of Class-1 nickel production globally.”
