Name of the Project
Cosmos Odysseus nickel project.

Location
Odysseus is located on a granted mining lease that is part of the high-grade Cosmos nickel complex, which is situated 30 km north of Leinster, in Western Australia.

Client
Western Areas.

Project Description
A prefeasibility study (PFS) has shown that re-opening the Cosmos nickel complex and mining the Odysseus deposit, which is located 400 m below the existing Cosmos underground infrastructure, will generate strong returns, with potential for further growth, given recent exploration results and other processing optimisations.

The project comprises mining 4.9-million tonnes of ore at a nickel grade of 2.3% from the Odysseus south and north deposits – situated 1 000 m below surface – using an extension of the existing Cosmos decline and processing the ore using the existing plant and infrastructure.

Odysseus will be accessed through a new central decline from the existing underground infrastructure, splitting into separate accesses for the south and north zones.

The primary mining method will be sublevel open stoping with paste fill using longitudinal ore drives on a 25 m crosscut spacing.

The south and north zones will be mined in a bottom-up sequence, with the north zone being mined from south to north.

Primary ventilation includes the completion of a partially reamed 5-m-diameter exhaust raise to surface and a new surface intake shaft completed in two legs using raisebore.

The Odysseus South zone will require the establishment of two destress slots in the central levels early in the mining schedule and mass blasting of both slots simultaneously prior to paste filling. The destressing slots will enable Western Areas to maximise recovery of ore from the south zone. The existing Cosmos processing plant will be refurbished and is rated at 430 000 t/y for disseminated ore, which is sufficient to handle mine output for the first 12 months of operations.

In the latter half of the first year of operation, the Cosmos processing plant will undergo an expansion to accommodate increased mine output of 750 000 t/y. 

The project has an initial 7.5-year mine life for total life-of-mine ore production of 4.9-million tonnes at a grade of 2.3% nickel.

Jobs To Be Created
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 7% discount rate, of $292-million and an internal rate of return of 28%, with a payback of 3.5 years from the start of production.

Value
Preproduction capital expenditure has been estimated at between $190-million and $210-million, including the PFS, the definitive feasibility study (DFS) and contingency costs.

The Cosmos processing plant will be refurbished at an estimated cost of $6.2-million. The expansion of the processing plant is estimated at $21.5-million.

Duration
First ore is expected to be mined in the fourth quarter of 2020, with concentrate expected to be delivered in the first quarter of 2021.

Latest Developments
Western Areas has approved a A$32-million early works programme at the Odysseus project.

The 18-month early works programme is focused on evaporation ponds, mine camp readiness, dewatering and decline rehabilitation.

Western Areas MD Dan Lougher told shareholders that the company was proud that the counter cyclical decision to pursue Cosmos in late 2015 was now rapidly crystallising into a significant organic growth project, with Odysseus to be the catalyst for its second production hub in Western Australia.

“We have taken this decision to commence early works, prior to the release of the definitive feasibility study, due to our confidence in the overall project and, just as importantly, our confidence in the nickel sulphide market.”

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Western Areas, tel +61 8 9334 7777, fax +61 8 9486 7866 or email info@westernareas.com.au.