Mincor's unfinished business in Kambalda

Mincor Resources is planting the seeds for a new era of Kambalda nickel production (reports MiningNews).
9th April 2021
Resources Rising Stars

Mincor Resources is planting the seeds for a new era of Kambalda nickel production (reports MiningNews).

The company has a long history in the area, kicking off its first mine at Miitel 20 years ago.

"Over the years, the company went on to consolidate ownership of the vast majority of the prospective Kambalda and Widgiemooltha Domes, and between 2001 and 2008, brought six new nickel mines into production," Mincor managing director David Southam said during a visit to the company's operations last week.

"This saw Mincor become one of Australia's pre-eminent nickel producers, delivering around A$1.5 billion at today's prices."

But operations were suspended in 2016 when the nickel price fell as low as US$7600 per tonne - from over $20,000/t just two years earlier.

"This period represented one of the toughest operating environments seen in the nickel industry in many decades," Southam said.

"However, it was during this time that the company laid the foundations for its current success."

A glimmer of hope for the company came in 2015 via the discovery of the Cassini deposit, the first greenfields nickel find in the Kambalda region in nearly 30 years.

The Cassini find earned Mincor geologists the AMEC Prospector of the Year Award for 2020 and formed the basis for Mincor's future.

Southam joined Mincor from Western Areas two years ago and the company's aim to re-establish itself as a nickel producer gathered pace.

By March 2019, a new five-year offtake deal with Nickel West had been signed and Mincor focused on establishing 50,000 tonnes of nickel reserves - enough to underpin a five-year mine life.

The company also acquired IGO's mothballed Long nickel mine to consolidate the Kambalda district.

A year later, the company unveiled the definitive feasibility study for its restart plans, underpinned by Cassini.

Capital costs were estimated at A$68 million for a five-year operation to produce about 14,000 tonnes of nickel per annum at unit costs of $3.36 per pound (US$2.35/lb) and all-in sustaining costs of $4.47/lb (US$3.13/lb), based on reserves of 65,400t at 2.8% nickel.

Nickel production is expected to peak at over 16,000tpa in FY23 and FY24.

Using a 7% discount rate, the DFS returned a post-tax net present value of $237 million, internal rate of return of 88% and payback period of just one year.

A final investment decision was made in September and last month, Mincor announced the close of a A$55 million syndicated facility agreement with BNP Paribas and Societe Generale.

Read more at https://www.miningnews.net/site-visits/news/1407880/mincor%E2%80%99s-unfinished-business-in-kambalda

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