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Odysseus sails into view for

Western Areas

xcitement is building at Western Are-
Eas Ltd about the impact the Odysseus
nickel project could have on group pro-
duction at a time of rising nickel demand.
Western Areas has been relatively
conservative in its public statements on
Odysseus since it paid Glencore $25 mil-
lion for the asset in 2015. However, with
early works progressing on plan manag-
ing director Dan Lougher is increasingly
bullish about the project’s potential.
Speaking in the opening session of the
Australian Nickel Conference, Lougher
said Odysseus – part of the Cosmos
nickel complex – was an exciting project
for the company.
“This is a project Xstrata paid $3.1 bil-
lion for in 2007 and we picked it up in
2015 for $24 million,” he said. “We are
very excited about what was left behind
by Glencore and the entire Leinster belt
is a new frontier for BHP Nickel West, so
we’re excited about working along the
belt.” Dan Lougher
Early works have already started at
Odysseus with decline rehab having ready has hopes of extending its longev- Discussing the $299 million capex,
reached 500m below the surface. West- ity. Lougher said funding would “be easy”
ern Areas is currently installing an under- A major focus is the AM5 and AM6 with several offtake providers and third
ground pump station to allow for further orebodies where indicated resources parties, including banks, already ex-
dewatering in the mine’s deeper levels. of 500,000t @ 2.6% nickel and 2mt @ pressing interest.
The main Odysseus North and South 2.6% nickel respectively currently sit out- Financiers’ eagerness to fund Odys-
orebodies will be accessed via shaft side the 8.1mt @ 2% nickel reserve. The seus reflects the simmering tension in
hoisting. Western Areas has acquired a company plans to drive a new develop- the nickel market as both traditional and
winder and head gear from a South Af- ment from Odysseus South across to the emerging users position themselves in a
rican platinum operation. The equipment two orebodies and the exploration team new era of supply and demand.
has already been dismantled and is cur- is already working on converting the indi- Western Areas is marketing its next
rently being refurbished in Johannesburg cated resources to reserves. three-year offtake contract and Lough-
ahead of shipment to Australia in March/ There are further targets on the mining er said even ahead of the annual LME
April. lease, including Mt Goode which has a Week negotiations he was fielding inquir-
Odysseus is one of several Australian 52.9mt @ 0.6% nickel resource, includ- ies from new players such as LG Chem
mining operations installing a shaft hoist ing a high-grade core of 4.4mt @ 1.14% and Chinese EV manufacturer CATL.
in a departure from the local convention nickel. While the present nickel market was
of decline development. Lougher said “We are beginning to look at Mt Goode,” still driven by stainless steel demand,
the economics of the system – which will Lougher said. “That has 300,000t nickel investors could expect the EV market to
pull 1.27 mtpa of ore and waste to sur- which is not in any plans at the moment. wield an increasingly large influence over
face – were compelling. It is just 40m below surface and has been demand in the coming decade, Lougher
“Shaft hoisting is a no-brainer when subject to a plethora of studies down the said.
you are 1,000m below surface,” he said. years so it is something we will keep it in Stainless steel producers would con-
“From that depth, trucking costs would the back of our mind.” tinue to rely on the nickel pig iron sector
be about $30/t whereas shaft hoisting is Once Odysseus is up and running for supply, but Lougher expected battery
in the single digits. There are also safety Western Areas can expect further re- manufacturers to increase their desire for
benefits with the stricter requirements on source tonnes to emerge, according to refined nickel.
diesel particulates coming online making Lougher. “We may see a divergent market in
it even more compelling.” “When you are operating a new mine, nickel supply between the stainless steel
Western Areas plans to produce you look for more metal and because you and EV markets,” he said.
13,400 tpa nickel-in-concentrate over have everything in place you naturally – Dominic Piper
a 10-year mine life at Odysseus but al- start finding more,” he said.

aUSTRaLIa’S PaYDIRT NOVeMBeR 2019 Page 37