Grade increase sees Nova outperform expectations

Nova

The Nova operation in Western Australia. Image: Independence Group

IGO has beaten its production target at the Nova nickel-copper-cobalt operation in Western Australia following higher feed grades and recoveries.

IGO mined a total of 402,000 tonnes of ore at Nova in the June quarter at average grades of 2.22 per cent nickel and 0.94 per cent copper.

IGO managing director and chief executive officer Peter Bradford hailed the impressive performance as a promising outcome.

“Performance from Nova has continued to impress, with full year production ahead of guidance for all metals, while cash costs finished the 2021 financial year at the lower end of the updated guidance range, which we adjusted lower during at the March 2021 quarter,” he said.

“This has resulted in record free cash flow generation from Nova of $393 million for the year – an outstanding result.”

The Nova mine produced 7887 tonnes of nickel and 3538 tonnes of copper in the June 2021 quarter.

This allowed the company to pass its nickel and copper production target for Nova for the 2020-21 financial year.

IGO produced 29,002 tonnes of nickel, as Nova inched past its 29,000-tonne guidance.

The company also produced 13,022 tonnes of copper for the 2020-21 financial year, surpassing its 11,000-to-12,500-tonne guidance.

IGO finalised its divestment of the Tropicana operation in Western Australia during the June quarter.

The company finished its work at Tropicana producing 63,248 ounces at an all-in sustaining cost (AISC) of $1830 per ounce at the end of May 2021.

Bradford said it marked a transition for the company to focus on clean energy metals, following the signing of a joint venture (JV) between IGO and Tianqi Lithium Corporation.

“This is an opportune time to reflect on the many achievements our business has made over the last 12 months,” Bradford said.

“Over the 2021 financial year, our talented and committed team have safely delivered consistently strong operating and financial performance, and have successfully reshaped our asset portfolio – transforming IGO into a future-facing resources business with a strategy focused 100 per cent on clean energy metals.

“The repositioning of our portfolio was completed during the June 2021 quarter, with both the Tropicana divestment and lithium transaction with Tianqi reaching financial close.”

IGO owns 51 per cent of the Tianqi JV and will give the company a 51 per cent stake in the Greenbushes lithium mine in Western Australia, and a 100 per cent owned and operated interest in the Kwinana lithium hydroxide refinery.

“Completing these transactions has been a key workstream for the business over recent months, and we are excited about the opportunity the new lithium joint venture presents to IGO and our shareholders,” Bradford said.

Sales revenue for the Nova operation was $225.5 million compared to $131.4 million in the previous quarter due to higher production and stronger metals prices.

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