The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
North of 60 Mining News - August 25, 2023
While pre-feasibility has been established for Nickel Shäw's Wellgreen deposit, Nickel Creek has also been exploring the Arch target, which has the potential to add significant resource to the already impressive project.
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Nickel Creek Platinum Corp. Aug. 24 published the results of a pre-feasibility study for the Nickel Shäw project in the southwest corner of Canada's Yukon, capable of producing 614.3 million pounds of nickel, 281.5 million lb of copper, 21.5 million lb of cobalt, 626,500 ounces platinum, 743,400 oz palladium, and 174,400 oz of gold over a 19-year mine life.
This PFS is based on an April calculation that shows Nickel Shäw hosts 122.4 million metric tons of measured and indicated resource averaging 0.26% (2.5 billion lb) nickel, 0.13% (1.3 billion lb) copper, 0.014% (137 million lb) cobalt, 0.23% (3.3 million oz) palladium, 0.22% (3.1 million oz) platinum, and 0.04% (545,000 oz) gold; plus 314.4 million metric tons of inferred resource averaging 0.27% (668 million lb) nickel, 0.13% (339 million lb) copper, 0.015% (37 million lb) cobalt, 0.25% (916,000 oz) palladium, 0.2% (733,000 oz) platinum, and 0.04% (128,000 oz) gold.
"The PFS is an important milestone in realizing the opportunity the Nickel Shäw project represents in the critical mineral space where it can provide nickel and copper to take advantage of the strong nickel market for EV batteries," said Nickel Creek Platinum President and CEO Stuart Harshaw.
Nickel Shäw lies approximately 317 kilometers (197 miles) northwest of the Yukon capital of Whitehorse and is accessible from the Alaska Highway, which leads to year-round, deep-sea ports in Haines and Skagway, Alaska.
The Nickel Shäw project also lies within the Kluane First Nation core area – as defined by a treaty with the Canadian and Yukon governments. In 2012, an exploration cooperation agreement was signed between the Kluane First Nation and Nickel Creek, which, along with the Yukon government, has supported the exploration of the nickel-rich project for over a decade.
Within the company's Nickel Shäw property, the primary area of focus is the Wellgreen deposit, but it also holds the Arch, Burwash, Formula, Musk, and Quill claims that have received less attention and exploration.
The PFS contemplates that Nickel Shäw would be mined as an open pit using conventional open pit methods, with a life-of-mine of over 19 years.
From the open pit, the ore would be trucked to a primary crusher, which would be adjacent to the pit and conveyed out of the valley to a concentrator designed to process 45,000 metric tons of ore per day. This ore would then be fed into a conventional nickel-copper-platinum group metals flotation concentrator to produce bulk concentrates or split concentrates.
Fully operational, the Nickel Shäw project detailed in the PFS is expected to produce an average annual concentrate of around 103,100 dry metric tons of bulk concentrate, or 95,000 dmt of nickel concentrate and 19,600 dmt of copper concentrate per year.
Concentrate would then be transported by truck 480 kilometers (298 miles) to the Port of Skagway Ore Terminal.
The economics of the PFS is based on a liquified natural gas plant being built on-site to power the mine.
Initial capital costs needed to develop the Nickel Shäw mine envisioned in the PFS come to approximately C$1.7 billion, with a construction period of three years-adding in sustaining costs, the total climbs to C$2.3 billion.
Using long-term metals prices – nickel (US$11/lb), copper (US$4/lb), palladium (US$2,100/oz), platinum (US$1,000/oz), cobalt (US$23/lb), and gold (US$1,800/oz) – and an exchange rate of C75 cents to US$1, the proposed mine at Nickel Shäw is calculated to generate an after-tax net present value (5% discount) of C$143 million and an after-tax internal rate of return of 5.8%.
"Moving forward, our focus will be to continue to add value to the project through work on identified key economic areas of opportunity and continued mineral exploration success while advancing towards a feasibility study," said Harshaw.
Opportunities to improve economic returns include working with energy providers, the Yukon government, and stakeholders on an energy strategy to reduce the costs for the project.
"The sensitivity to energy costs illustrates how working with different levels of government can lead to a significant improvement in value, especially when combined with the previously announced intention of the federal government to provide a tax incentive for critical mineral projects such as Nickel Shäw," the Nickel Creek Platinum CEO explained.
Nickel Creek estimates that if the Canadian tax incentive for critical mineral companies is enacted, the after-tax NPV for a mine at Nickel Shäw would jump from C$143 million to C$336 million.
The company says additional metallurgical test work to improve overall recoveries of all payable metals would also improve the economics – an estimated 1% recovery improvement would represent a roughly C$111 million rise in the after-tax NPV of the mine.
Another viable option would be further drilling on exploration targets to define more potential resources that could offer higher-grade feed early on in the project.
If the economics can be improved, Nickel Shäw has the possibility to offer carbon sequestration benefits to Canada and the world. Research through the University of British Columbia and start-up Carbin Minerals has been ongoing to maximize the CO2 absorbing potential of brucite-enriched ultramafic rocks in the Wellgreen deposit proposed to be mined at Nickel Shäw.
By connecting to a grid, expanding possible resources, and sequestering the carbon that would be output from the mine, Nickel Creek has several options to increase the economic and environmental value of this timely nickel mine.
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