Western Areas backs Odysseus with $32m investment

The Cosmos site.

Western Areas has approved plans to launch a $32 million early works program on the Odysseus project at its Cosmos nickel operations in Western Australia.

The miner will start the program despite not yet releasing a definitive feasibility study (DFS) for the project, a reflection of its confidence in the development and demand for nickel sulphides in the battery and electric vehicle (EV) markets.

Western Areas acquired the Cosmos operations through a deal with Glencore in 2015.

The Odysseus early works program, which will start later this month, will involve three major work programs over an 18-month period. The first stage will include the refurbishment of existing evaporations ponds, pipeline upgrades and continuation of pit de-watering.

Stage two will involve construction of two new evaporation ponds and dewatering of the decline. The final work program will focus on infrastructure to support the rehabilitation of the decline from the portal to 500m underground.

Odysseus will be development ready based on the prefeasibility study schedule once the work programs have been completed, according to Western Areas.

Managing director Dan Lougher said the company’s counter cyclical decision to purchase Cosmos in late 2015 was now rapidly crystallising into a significant organic growth project.

Lougher expects Odysseus will be the catalyst for Western Areas’ second production hub in Western Australia. It would also be the company’s third operating mine.

“We have taken this decision to commence early works, prior to the release of the DFS, due to our confidence in the overall project and just as importantly, our confidence in the nickel sulphide market,” Lougher said.

“The demand for class one nickel sulphides in the battery and EV market is forecast to grow substantially over coming years.

“We believe that Odysseus is one of a very few select nickel sulphide projects that will be coming into production in a timeframe that will enable it to deliver into that growing demand profile, which we are seeing validated by the strong inbound interest from potential offtake parties and project investors.”

Western Areas has previously stated it expects Odysseus to have a mine life beyond 10 years with average production in excess of 12,000t a year of nickel. The DFS has been scheduled for release in the September quarter.

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.