Western Areas has secured an extended off-take agreement with BHP Billiton Nickel West to sell an additional 2000 tonnes of nickel concentrate mined from Kagara’s Lounge Lizard deposit.
The Lounge Lizard deposit is adjacent to Western Areas’ Flying Fox mine.
The company has an existing agreement with Kagara, which allows it to mine the deposit, process the ore through the Cosmic Boy plant and sell the concentrate through its off-take contracts.
Prior to this new contract, Western Areas was selling 10,000 tonnes per annum to BHP Nickel West.
The deal also takes the company’s maximum annual sales up to 15,000 tonnes.
The contract will commence once a two-year contract to sell 25,000 tonnes of nickel to Jinchuan in completed.
Concentrate produced from Lounge Lizard ore prior to 2012 will be sold into existing contracts with BHP and Jinchuan.
According to the company, it will have significant amounts of additional nickel not committed to any off-take contracts from 2012, based on current production.