Mallee Resources Limited (ASX:MYL) has produced its first concentrate at the Avebury Nickel Project in Tasmania after a successful start to the commissioning of the processing plant.
This is a historic moment for Mallee which now joins the ranks of Australian nickel sulphide producers. The Avebury mine is distinguished within this peer group by having a majority of its power needs met by renewable energy sources,” Managing Director, John Lamb, said.
As at October 21, around 19,200 ore tonnes were on the ROM stockpile, a further 2,500 tonnes were on fine ore stockpiles, 58,500 tonnes had been processed and 2,045 tonnes of nickel concentrate have been produced.
Final concentrate is transported to Burnie where it awaits shipment to customers of Hartree Metals LLC, the company’s offtake partner. Under the terms of the offtake agreement, the company may elect to receive partial advance payment for interim concentrate stored pending shipment to Hartree’s customers, with the balance to be paid on completion of each shipment. In accordance with the terms of the offtake agreement, the company has received its first partial advance payment for concentrates from Hartree. In this way, the company is able to receive part-payment for interim production, prior to the completion and dispatch of a shipment.
Shipments are expected to commence once sufficient concentrate has been stockpiled. The size of each shipment depends on the destination and the nature of the arrangement between Hartree and its customer, but typically comprises many thousands of tonnes of concentrate. Once each shipment is compiled, it is closed off and the quality of product in the shipment is determined under the terms of the offtake agreement.
Concentrate is bagged on arrival in the Burnie warehouse and assayed pending its inclusion in the shipment. Once sufficient concentrate has been stockpiled and the shipment has been closed, interim specifications will be determined prior to dispatch on a weighted average basis. This process yields a statistically valid specification of the product in the composite shipment, honouring the individual samples from which it is derived. Final assays are taken post-shipment in order to determine the agreed specifications and final payment terms of concentrate delivered.
The first concentrate stockpiled reflects the commissioning phase of operations. Work is ongoing to optimise recoveries and concentrate grades consistent with Avebury’s commissioning plans and the currently stockpiled concentrate is intended to be blended with future concentrates prior to shipment occurring.
The first stope in the underground mine was completed on schedule in September, producing well fragmented ore. Commissioning of the crushing circuit, including the recently constructed dust extraction system, has been outstanding. The crushing circuit is consistently producing a product appropriately sized for the grinding circuit and is producing enough daily feed for the grinding circuit after approximately 14 hours of crushing per day, demonstrating capacity for crushing at expanded throughput rates.
The grinding and flotation circuits have also been performing well. After resolving early commissioning challenges MYL’s team has shifted its focus to process control and preventative maintenance operations. The flash flotation and retreatment circuits have not yet been commissioned but are expected to further improve performance.
The concentrate filter press has been performing well after a significant refurbishment program. The flotation circuit has been tested at rates above nameplate and work will be undertaken to de-bottleneck the filtration circuit with the aim to achieve similar rates.
“This is yet another outstanding achievement by John and his team. Commissioning began on schedule and has gone very well to date. Our team has been equal to any challenge presented and we now have now produced concentrate. Mallee’s future looks very bright,” Chairman, Jeff Moore, said.