Poseidon Nickel is reconsidering its care and maintenance plan of the Black Swan project in Western Australia amid a boost in nickel prices.
Recent explorations revealed two near-surface, high-grade nickel targets at the project, an attractive prospect given Poseidon would not have to make the costly trek underground.
“There is a strong desire to test these targets in the short term as a high-grade discovery can potentially add to reserves for any future Black Swan restart with the potential to decrease the unit costs and further improve the project economics,” Poseidon chief executive officer Brendan Shalders said.
“The company plans to undertake low-cost surface drilling programs to test these targets in the near term.”
Shalders said he was pleased to see the strong increase in the nickel price, but acknowledged that prices are likely to remain volatile for the foreseeable future.
“With this in mind, the company has reviewed its care and maintenance at Black Swan and has implemented initiatives to further remove up to $1 million of annualised costs,” he said.
Looking to a future restart of the Black Swan mine, which has been out-of-action since 2008, Shalders said there will be significant infrastructure works undertaken.
“There would be additional capital expenditure required to undertake these works, however the cost would unlikely be prohibitive to restarting the project,” he said.
Following identification of the new prospective targets at Black Swan, Poseidon’s next steps include completing the data integrity review for the upper Northern Terrace and the remainder of the greater Black Swan project area.
This will include extending the detailed section-based footwall model across the entire project area focusing on near-surface opportunities.
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