LionOre Mining International (LIM-T) has approved a plan to develop an exploration decline at the Waterloo nickel sulphide deposit, 5 km northwest of its Thunderbox gold mine in the Northeastern gold fields of Western Australia.
The company plans to begin excavating a 30-metre-deep pit 1 km east of the deposit in May; work to drive a 1-km decline into the deposit from the base of the pit will begin in August, with arrival slated for the second half of 2006.
The decline is designed access Waterloo’s high-grade nickel mineralization at a depth of around 150 metres; it will also allow for exploration of potential depth extensions to the deposit. LionOre will also produce a high-grade nickel concentrate from the development material for sale or treatment.
At the end of 2004, Waterloo’s indicated resources stood at 299,000 tonnes grading 3.5% nickel, 0.26% copper, and 1.13 grams platinum group elements (PGE) per tonne, for 10,366 tonnes of contained nickel. Another 297,000 tonnes of inferred material runs 1.4% nickel, 0.1% copper, and 0.5 gram PGE. The estimates are based on a cutoff grade of 1% nickel. The deposit remains open downdip.
The deposit has been defined over nearly 900 metres of strike length and to depths of 50-70 metres. Mineralization comprises massive, matrix, disseminated, and remobilized stringer and breccia sulphides. The disseminated mineralization lies stratigraphically above the matrix zone, while most of the high-grade mineralization is localized near a fold structure that plunges shallowly to the south.
With its proximity to Thunderbox, Waterloo will require only limited infrastructure; pre-production capital costs are estimated at US$16 million.
LionOre’s plan calls for Waterloo ore to be trucked to either its Emily Ann nickel concentrator at Lake Johnston or to the Black Swan concentrator near Kalgoorlie in Western Australia. The resulting concentrates will either be sold to a traditional smelter or provide feed to support LionOre’s hydrometallurgical strategy in Western Australia.
The plan does not include the Amorac nickel deposit, 300 metres to the east, which could potentially be accessed by future development of Waterloo.
The development plan is fully permitted.
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