Estrella one step closer to nickel production

Near-term nickel producer Estrella is one step closer to delivering its much needed battery metal to the market. Glencore’s Murrin Murrin operation has received a bulk sample of high-grade nickel from the company’s Spargoville 5A project, 20 kilometres south-west of Kambalda. Estrella says its assays have met all the specifications from Glencore and the processing of the sample has begun.

The outcome of the sample from 5A will underpin Estrella’s definitive feasibility study, with details available later this quarter.

A 50 per cent provisional payment has been received for 1994 wet metric tonne of ore in January, with the payment to be based on the weighted average price of the London Metals Exchange March nickel contract. The remaining 418 wet metric tonne that was delivered in February will be priced on the LME nickel contract weighted average price for April.

Estrella is looking to finalise the optimal pit design, site schedules and layout. Once these three items are completed Estrella says it will begin detailed financial modelling for its 5A project.

The company says the information from the processing of the bulk sample will feed into the DFS which began in 2022. Furthermore, this sample will see Estrella revise the flowsheet processes to treat three other nickel projects as part of the Spargoville block.

With the successful delivery of the metallurgical sample to Glencore, Estrella has passed a very significant milestone on the way to getting the Spargoville Nickel Project into production. The backdrop of strong nickel prices is providing confidence that Estrella should be able to commence the 5A Nickel Mine open pit project this financial year subject to statutory approvals, positive DFS and financing.

Currently the DFS assumes Spargoville 5A will be a simple open pit cut mine to access to the high-grade nickel sulphide material, with a measured resource at 16,000 tonnes and 7.8 per cent nickel grade.

This isn’t the first time 5A has been mined with the site actively excavated between 1996-1997.

Estrella picked up the site when the company bought WA Nickel in 2017 but had it on the market a little over a year ago so the company could focus on its flagship project, the Carr Boyd mine some 80 kilometres north-east of Kalgoorlie.

However judging by recent events the project is now a key piece of Estrella’s armoury.

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