Western Areas has shown strong progress at the Odysseus project at the Cosmos nickel operations in Western Australia, with its stage two early works program kicking off with contractor Barminco on schedule.
Its stage two program at the site will see the dewatering of the decline by Barminco for six months and the construction of two new evaporation ponds.
The achievement follows a drop in Odysseus’ open-pit water level by 37 metres, or 1.8 million cubic metres of water – by the end of December 2018 since pumping began in January last year.
A ramp up of the mill recovery enhancement project (MREP) also continued during the December quarter, with several containers of the MREP product being sold into the spot market and evaluated by customers.
Western Areas managing director Dan Lougher said the Odysseus project was entering “the exciting development phase”, with the project commencing underground activities and optimisation work for additional production volumes from AM5 and AM6 deposits continuing.
Both AM5 and AM6 host a combined indicated mineral resource of 57,600 tonnes of nickel.
A number of optimisation projects will also be investigated at Odysseus in the short and medium term, which focuses on its mine optimisation, purchase of second-hand shaft infrastructure assets and final engineering design for the shaft.
According to Western Areas, the fundamental outlook for nickel appears strong, with the [London Metal Exchange] nickel stockpile falling towards 200,0000 tonnes during January – the lowest level in over five years – demonstrating that demand continues to outstrip supply.
“Encouragingly, the nickel price has started the new calendar year on a positive trend, with stainless steel consumption remaining healthy, and the outlook for nickel-intensive electric vehicles battery demand remaining promising,” Western Areas said in an ASX statement.
The bounce in trend followed volatility in nickel prices during the first half due to geo-political factors placing downward pressure on global markets including base metals.