JOHANNESBURG (miningweekly.com) – The stronger nickel market and a weaker Australian dollar are working in Western Australian firm Panoramic Resources’ favour as it works towards a decision about restarting the Savannah nickel mine, in the East Kimberley.

The Savannah mine has been under care and maintenance for a year-and-a-half, but the recent strengthening of the nickel price has sparked Panoramic’s interest in recommissioning the project.

The company has updated Savannah’s feasibility study this year and will be targeting 10 800 t/y of nickel, 6 100 t/y of copper and 800 t/y of cobalt from the mine. All three metals are essential materials for the fast-growing battery industry.

“We are busily working to clear final hurdles that will allow the company to make the decision for the Savannah operation to be recommissioned when the US dollar nickel price and the exchange rate are favourable,” Panoramic chairperson Brian Phillips said in his address to the company’s general meeting this week.

The firm has recently completed metallurgical test work on Savannah North ore to confirm the Savannah treatment plant recoveries to produce a bulk concentrate of nickel, copper and cobalt, and the expected concentrate grades. Potential customers are also now able to submit final detailed terms for long-term offtake contracts. Once concentrate purchase terms have been agreed, Panoramic will finalise financing for preproduction capital and working capital.

The restart of the mine is estimated to cost A$36-million, according to the October 2017 updated feasibility study.

The company has also been progressing necessary state and local authority approvals on detailed engineering inspection of the Savannah treatment plant and infrastructure to scope required maintenance and upgrades.

Phillips expressed concern, however, about whether Panoramic would be able to secure the required skilled workforce to reopen the mine. The mine would employ about 250 full-time and contract staff.

“The last few years has seen a significant reduction in mining and mining support workforce, particularly in Western Australia. In the last six months, the demand for professional and skilled trades staff has accelerated and salaries are being structured accordingly.”

He said Panoramic would encourage staff to be based in Kununurra, which is about a three-hour drive from Savannah, to limit fly-in, fly-out costs.

Panoramic’s other nickel mine, Lanfranchi near Kambalda, is also under care and maintenance and Phillips reaffirmed that there is no plan to reopen the mine, which contains 5.6-million tonnes at 1.69% nickel.