Western Areas
Leading nickel producer Western Areas is solidifying its place in emerging markets, with its Odysseus project on track to bolster nickel production from its existing operations in Western Australia.
WESTERN Areas is bang on track to coincide production at its Odysseus project with the expected high demand for nickel in the electric vehicle market in 2022.
The project sits within the Cosmos nickel complex, alongside Western Areas’ existing Forrestainia operation in WA, 28km northwest of BHP’s Leinster nickel operations.
Western Areas managing director and chief executive officer Daniel Lougher said that early works on site were almost complete.
“Early works was being done in parallel with the definitive feasibility study and included dewatering, creating evaporation ponds and doing some work at the camp plus the rehabilitation of the existing decline underground,” Mr Lougher said.
“We’re now sitting fully rehabbed down to a vertical depth of about 500m below the surface, and we are just about to develop a pumps station which will then allow us to continue dewatering from an underground position.”
Progress is continuing on time and on budget, and once the pump station is commissioned, rehabilitation work will continue down to the AM5 and AM6 ore body positions where a fresh rock decline will be cut heading over to Odysseus.
“We expect to be in that position around about February 2020,” Mr Lougher said.
“Obviously we have a bit to go yet, but we are expecting to get first concentrate in the December quarter 2022.”
The Odysseus project is expected to produce between 13,000t and 15,000t of nickel concentrate to add to the company’s current production at Forrestania from the Spotted Quoll and Flying Fox mines, which Mr Lougher said were tracking as planned.
“While Flying Fox reserves are currently under review, we have around two or three years left of production,” he said.
“At Spotted Quoll we have around six years so there is an overlap between these production units and bringing Cosmos’ Odysseus mine online as well.”
“In conjunction with all of this, we are doing a lot of organic project work in terms of projects such as New Morning which would be open pit at Forrestania.
“We’re looking at projects where we would be doing heap leach processing of mill scat and the use of laboratory developed bacteria for our bio-heap technology.”
Emerging markets
Western Areas is perfectly placed to take advantage of the emerging electric vehicle (EV) market when Odysseus comes online.
“In the current EV market the battery of choice is the lithium ion battery, the name of course doesn’t have any nickel in it, but there are several types of battery technology used in cars such as Tesla called a 6:2:2 technology - which is six parts nickel, two parts cobalt and two parts manganese in the cathode of the battery,” Mr Lougher said.
“There is also a new technology starting to be utilised in Japan and Korea, and probably China, called a NCM811 battery, which is eight parts nickel.
“So as you can see the quantity of nickel within the battery is increasing because it gives the battery certain positive characteristics in terms of charging capacity and how long the car can drive for, etc.”
Mr Lougher said the development of EV batteries is an exciting prospect for nickel miners because it means the demand for nickel sulphide should get stronger.
“The penetration rate of electric vehicles should heat up around 2022-25, so with Odysseus coming into production around that time, Western Areas will be primed to meet a strong demand for nickel products,” he said.
“The timing is excellent, plus on reserves alone, Odysseus has a 10-year mine life (not including the AM5 and AM6 deposits) so when we come past them in early 2020 we’ll have a better idea of when to extract and expand the mine life of the project.
“There are higher grade parts of Odysseus we haven’t been able to bring into the feasibility study but the potential for the project is quite a rare occurrence in the world of nickel sulphide.”
With few new deposits being discovered globally, Western Areas considers itself fortunate to have Forrestania and now Cosmos – which was an extremely strong nickel producer for prior owner Glencore.
“We’re extremely happy and excited that we’ve got this new sulphide mine coming online as the market driven demand for the batteries will be in full flight,” Mr Lougher said.
“The penetration rate of electric vehicles should heat up around 2022-25, so with Odysseus coming into production around that time, Western Areas will be primed to meet a strong demand for nickel products.”