Chalice Mining is set to reduce expenditure by 40 per cent in light of the recent weakening of nickel prices hitting the sector.
The company will reduce executive salaries, director fees, and other corporate costs to the tune of $2.2 million for the year.
The completion of resource drilling at Chalice’s Gonneville nickel-copper-platinum group element project in Western Australia will also see a reduction of $29 million on 2023.
Expenditure is anticipated to average $3 million a month in 2024, down from $5 million a month, which the company said can be adapted according to market conditions.
“Market conditions have continued to deteriorate in the resources sector in the early part of 2024, particularly in nickel and platinum group metals,” Chalice managing director and chief executive officer Alex Dorsch said.
“The changes implemented will ensure that Chalice maintains a strong cash runway, giving us the flexibility to navigate through the current challenging market conditions while ensuring we are still well placed to capitalise on the value of the Gonneville asset for our shareholders.”
Chalice said the expenditure review will not affect the overall Gonneville project development schedule or ongoing high-priority greenfield exploration activities across the West Yilgarn province in WA.
Now that drilling completed at Gonneville has confirmed a high-grade resource suitable for open pit and underground mining, the company will progress the project towards a pre-feasibility study set for completion in 2025. A final investment decision is slated for late 2026.
Two rigs are currently undertaking greenfield exploration at the northern end of the Julimar complex and an initial program of drilling at Barrabarra is nearing completion.
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