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DIGGeRs & DeALeRs

Western Areas has continued to hit guidance at its
Forrestania underground operations
Western Areas

arrives to bolster

Panoramic

recovery

The arrival of Western Areas onto the Panoramic register may
give some impetus to the troubled Savannah nickel operation

19.9% investment by fellow nickel 66% uptake, meaning there was only a 1.49% nickel). However, it quickly ran into
A miner Western Areas Ltd may be $5 million shortfall. That meant the under- trouble with a mine plan designed to mine
a lifeline or the beginning of the end for writers could only take 20% of what they remnant ore from the original Savannah
embattled nickel miner Panoramic Re- had proposed.” orebody while development to Savannah
sources Ltd. The company’s debt burden lifted, at- North was completed.
Western Areas’ arrival on the Pano- tention will now turn to improvements to The company suspended operations
ramic register came as part of a $90 mil- the restart plan for the Savannah mine in April this year as the company battled
lion capital raising in May designed to where activity has been blighted by nu- seismic events, equipment availability is-
restructure the company’s balance sheet merous setbacks over the last 18 months. sues and ventilation problems. Rajasoo-
and buy it time to improve performance The arrival of Western Areas onto the riar said the company now had clear sight
at its Savannah nickel mine in Western register could be an advantage in this on the operation’s future.
Australia. area. Managing director Dan Lougher “It was too heavily reliant on Savannah
Funds generated from the raising were told Paydirt TV his company would give remnants and the execution of being an
used to ease Panoramic’s debt problems, its full technical support to Panoramic. owner-miner and the technical inexpe-
paying its $25 million senior debt facility “There’s always challenges in mining, rience of management was telling,” he
to Macquarie Bank Ltd and its $8 million we know that with our own operations,” said. “Western Areas gives us that back-
subordinated debt with major shareholder he said. “We understand the business stop. Barminco will come in as the con-
Zeta Resources Ltd. of mining at depth in hard rock. We have tractor, as they are at Forrestania, and
As part of the corporate restructure, first class engineers and geologists and that will see the project benefit from their
Western Areas took a $21 million place- we want to have a look and see where associated technical skills.”
ment and acted as sub-underwriter to a we can add value to the reopening of that Lougher is eager to revisit the develop-
$38 million retail entitlement offer while mine.” ment plan for the operation, with a focus
an institutional entitlement offer raised a Rajasooriar said investors would take on Savannah North’s development.
further $31 million. comfort from the arrival of the company’s “Savannah North is where we want
Following the capital raising, Zeta will new major shareholder. to focus,” he said. “Savannah possibly
control 20.1% of Panoramic (down from “Western Areas has already looked at shouldn’t have been contemplated and
35.2% pre-raising) and Western Areas the mining plan as part of its due diligence maybe that’s where things got a bit lost;
will hold 19.9% with remaining sharehold- process,” he said. “They are in agree- reopening an old area and opening up a
ers retaining 60% of the stock. ment; it is about working around the Sa- new area at the same time. What perhaps
“We were very pleased with the sup- vannah remnants and making Savannah should’ve been looked at was a brand-
port for the capital raising,” Panoramic North the priority. new capital project.
managing director Victor Rajasooriar told Panoramic began the Savannah re- “The other thing was the ventilation
Paydirt. “We targeted $90 million and it start in the December 2018 quarter, hav- rise; we’ve had a good look at it and be-
has been well supported. The retail com- ing been encouraged by the size of the lieve it is fixable.”
ponent has just been completed with new Savannah North orebody (5.97mt @ Rajasooriar said it would take six

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