Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (34752)	3/26/2009 10:17:12 PM
From: LoneClone	Read Replies (1) \| Respond to of 193970

Nickel mining a ‘lonely’ industry 25th March 2009, 8:15 WST thewest.com.au “Lonely” was how Western Areas managing director Julian Hanna described the state of the nickel industry yesterday at the official opening of the group’s $30 million Cosmic Boy concentrator. Flagging plans to potentially expand the mill’s capacity from 300,000 to 550,000 tonnes of ore a year, Mr Hanna said the plunging nickel price had changed the face of the sector. “It’s getting lonely in the nickel sector,” he said. “There are very few left of our type. “We are seeing an industry that’s changing very rapidly.” The high-grade, low-cost nature of Western Areas’ Forrestania project, about 400km south-east of Perth, has put the company in the enviable position of pushing ahead with its plans at a time when many other miners are closing operations. With operating costs around $US2 a pound or less — versus a nickel price of $US9905 a tonne — it has remained profitable when many of its rivals have not. The concentrator is intended to treat high-grade ore from Western Areas’ flagship Flying Fox mine. A decision on whether to go ahead with the $20 million mill expansion is expected in the June quarter of this year. The expansion would be required to process ore from the Spotted Quoll mine, which is due to start high-grade production by the end of the year. “We are currently processing at a rate of 300,000tpa,” Mr Hanna said. “So that’s satisfying production from Flying Fox but clearly it needs to be expanded for Spotted Quoll.” Among those present yesterday was Mines and Petroleum Minister Norman Moore, who described the day as “very significant” for the State’s embattled mining sector. Chairman Terry Streeter was absent to attend the second day of an 18-day trial relating to Western Areas Exploration. Mr Hanna also said a decision on whether to go ahead with its Cosmic Boy and Diggers South deposits depended on the nickel price. He said lower grade deposits would only “begin to look interesting” at prices around $US6/lb. “Can (the nickel price) stay down there much longer,” he said. “I do not believe so. In terms of Western Areas we (remain profitable) at these prices, however, we would be more comfortable when that nickel price reaches $US6/lb and I’m not going to take any guesses as to when that might be. Soon, I think the answer is there.” Next on the agenda for Western Areas is likely to be a new offtake deal for production not covered by its recently announced offtake deal with BHP Billiton. Shares in the group closed steady at $3.50 yesterday. The reporter travelled to Forrestania with Western Areas. KATE EMERY