Mincor Resources has reported a stream of positive outcomes for the March quarter as it shifts focus to completing site works at the Cassini nickel mine in Western Australia.
Early works to Cassini’s haul roads, surface clearing and excavation of the box-cut materialised in the March quarter and have remained on track with no impact from the coronavirus pandemic.
Mincor managing director David Southam said the March quarter was productive for the company.
“With the definitive feasibility study (DFS) now complete, we are making progress on multiple fronts with the early works at Cassini commencing in February 2020 and on track for completion in April,” he said.
“Discussions with potential financing partners have also been encouraging with a number of indicative financing term sheets received in early April for consideration.
“The independent technical expert report, being prepared for the benefit of these potential financiers, is nearing completion.”
In the June 2020 quarter, Mincor is also planning to complete negotiations for a final contract with its remaining two underground mining contracts; negotiate and secure a binding credit approved term sheet from finances; and execute mining and logistics contracts.
Also finished in late March, the company’s nickel restart DFS outlined a five-year operation with a production target of 71,000 tonnes of nickel and 5000 tonnes of copper-in-ore.
The DFS also highlighted low capital intensity with $68 million of pre-production capital expenditure required.
The company’s nickel ore reserves also coined a 132 per cent increase for the March quarter to 2.3 million tonnes at 2.8 per cent nickel for 65,400 tonnes of nickel.
“The March 2020 quarter marked the culmination of an exceptionally busy period for Mincor, with the completion of our nickel restart DFS in conjunction with a maiden ore reserve for Cassini and an overall 132 per cent increase in company-wide nickel ore reserves,” he said.
“I was personally very pleased that we were able to table the DFS on time and within budget on March 25 2020, notwithstanding the impact of the COVID-19 pandemic during the quarter.
“The DFS outlines an economically robust operation with exceptionally low capital intensity, delivering a 98 per cent IRR (internal rate of return) before tax.
“This outcome justifies the company’s low risk, high-return development strategy based on processing ore through the Kambalda nickel concentrator and selling the resulting nickel concentrate directly to BHP Nickel West.”
Cassini has now become Mincor’s primary focus after returning new drill intersections, including 17.6 metres at 5 per cent nickel and 13 meters at 6.1 per cent nickel in the site’s CS4 channel.
Southam stated the company had also taken a strong stance towards managing coronavirus, however no material interruptions have occurred so far.
“To date, our business has not been materially interrupted with drilling activities, early works and other activities continuing,” he said.
“We are cognisant that depending on how COVID-19 transpires over the next few months, it has the potential to affect the company’s project development timetable.”
Mincor’s end-of-quarter cash at bank was sitting at $52.2 million with no debt.