Lunnon Metals Limited (ASX: LM8) has awarded a contract to announce that Webdrill Australia and mobilised to site to complete a geotechnical diamond drill hole at the Baker deposit, part of the company’s Kambalda Nickel Project (KNP) in Western Australia.
The drill programmr, which will be collared in the West Idough open pit, has been planned to collect data from a hole that mirrors the path of the decline, as designed in the recently announced Baker Preliminary Feasibility Study (PFS) report.
The Baker portal and decline will provide access to future underground development and production at the Baker Deposit, which has an Initial Probable Ore Reserve of 612kt averaging 2.86% Ni for 17.5kt contained nickel.
The portal site in the West Idough open pit is just 450 metres away from the nearest planned stoping areas of the Baker Ore Reserve, highlighting the Company’s ability to move rapidly and at low capital cost from explorer to producer. Webdrill mobilised to site today and are currently establishing the drill site adjacent to the future Baker portal location.
The hole is expected to take one month to complete and will then be geotechnically logged with the results feeding into the PFS underway, focussed on the 57,000t of nickel metal in Mineral Resource1 hosted at the Foster nickel mine.
Whilst we have gathered a wealth of geotechnical data already to inform our mining method selection, production rate and forecast operating cost at a future Baker underground operation, this simple step of drilling a hole to mirror the decline path aligns with our cautious, data driven approach to de-risking our assets at Kambalda.” Managing Director, Ed Ainscough, said.
“Once permitting and studies are complete, we can initiate development at a time of our choosing, offering our shareholders highly levered exposure in any future rising nickel price environment.”
The technical study programme is progressing well and the results, if positive, will form the basis of an updated PFS for Baker and Foster that is expected to update and improve the Company’s Ore Reserves.
Foster’s Mineral Resource in the Indicated category is currently 1.23 million tonnes grading 3.2% Ni for 39,000 tonnes of nickel metal and is expected to grow as the company progresses its historical core programme on areas relating to remnant nickel mineralisation remaining at the end of the WMC Resources Ltd operational period.
Completing the updated PFS will quantify the current view of the nickel production potential from the KNP and better position the company to continue detailed negotiations with potential ore tolling and concentrate purchase (OTCPA) partners in the immediate local area.
