Poseidon sees massive increase in nickel reserve

Poseidon Nickel has announced an enormous 121 per cent increase in its probable nickel reserves at Mt Windarra.

The announcement comes on the same week the miner cut 45 workers and suspended drilling.

Sources close to contracting businesses at the site said 45 workers were "completely shocked" at being told their jobs had been cut on Tuesday after Poseidon Nickel suspended drilling at the site.

According to Poseidon, the completion of an underground drilling program has dramatically increased its probable reserves from 330 000 tonnes to 498 00 tonnes at a grade of 1.78 per cent, which has also been increased from a previous grade of 1.22 per cent.

This takes its actual reserves from 4000 to 8850 tonnes of nickel.

Following on from this increase, the operation's total resources, both indicated and inferred, have increased by 19 per cent to 4.8 million tonnes at a grade of 1.68 per cent for 80 200 overall tonnes of nickel.

Poseidon CEO David Singleton stated that "we're extremely pleased to have added substantially more nickel to our mine plan, which will have positive repercussions for cash flow and payback in the early life of the mine".

"These results build on our track record of solid resource growth, which has been at an average rate of 24 per cent in nickel tonnage terms since 2007."

Singleton added that it plans to bring Mt Windarra back into production ahead of the expected shortfall in nickel supply.

Commenting on the redundancies, the company said "that unfortunately due to the current poor conditions for mining service providers a number of contractors have chosen to stand down a number of their staff.

Poseidon will carry out follow up exploration drilling to shore up its resource.

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