Anxious to catch the peak of nickel prices, Rio Narcea Gold (RNG-T) now plans to begin underground development of its Aguablanca nickel project in western Spain even before open-pit mining starts.
Aguablanca, where an open pit mine and mill are currently under construction, is scheduled to start production in the middle of next year, producing 8,200 tonnes nickel and 5,000 tonnes copper annually, along with 20,000 oz. of platinum-group metals. Current nickel prices, currently above US$12,500 per tonne, and the prospect of continued deficit in the nickel market have persuaded Rio Narcea that higher-grade material below the planned open pit should be brought into production earlier in the mine’s life.
Development work is budgeted at US$5 million and will include driving a decline ramp into the mineralized zone and drifting to provide underground drill stations. Rio Narcea geologists believe the known mineralization is faulted off and hope to locate the faulted extensions of the mineralized system underground.
Drilling below the limit of the planned open pit has encountered significant widths of mineralized material, running 0.6% to 2.66% nickel and 0.14% to 1.25% copper. The reserve in the open pit has been calculated at 15.7 million tonnes grading 0.66% nickel and 0.46% copper, with platinum, palladium and gold credits.
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