Poseidon Nickel Ltd (ASX: POS, 'Poseidon' or 'the Company') is pleased to report on the continued progress towards the restart of the Black Swan project based on the November 2022 Bankable Feasibility Study for the 1.1Mtpa mill feed option to produce smelter grade concentrate (refer to Company ASX announcement 'Positive Black Swan Feasibility Study', dated 21 November 2022).
Various work streams continue to be progressed as the Company heads towards the restart with the Final Investment Decision (FID) on track to be made late June/early July 2023.
Managing Director and CEO, Peter Harold commented: 'The offtake and project financing work streams continue with the shortlist reduced to two parties with whom we are now negotiating separate offtake and project financing agreements. We are aiming to execute documents with the successful party in late June/early July 2023. We continue to study the Expansion Project with metallurgical testwork progressing and rougher concentrate samples provided to potential customers for testing of downstream processing. The attraction of the Expansion Project is that annual production of nickel in concentrate could increase and the mine life could be extended due to the ability to treat talc carbonate material which is not included in the current Ore Reserves. The key to unlocking the value of the talc carbonate material is finding the most attractive customer for the proposed product which is a major focus of the expansion study.
Black Swan Disseminated Resource Drilling Program
The Company completed a 112-hole reverse circulation drilling program for a total of 10,845 metres, from the bottom of the open pit, into the Black Swan Disseminated Resource in February 2023. All assay results have been received with the resource model update due for delivery late May/early June 2023. The principal aims of the drill program were: to increase the confidence in the Black Swan Resource, by infilling the area extending approximately 125 metres immediately below the existing Black Swan open pit with the objective to better delineate the metallurgically important serpentinite and talc-carbonate hosted resources in this area and to lift most of these resources into Measured and Indicated; to provide more detailed production scheduling for commencement of operations and to supply additional material for ongoing metallurgical testwork on the Expansion Project.
Workstreams for the Restart
The main workstreams are progressing as follows: Offtake and financing - see below
Pre-works at Black Swan
Resource upgrade - due late May/early June 2023
Processing plant - contract for plant refurbishment being negotiated
Approvals - continuing to work on obtaining any outstanding approvals
Personnel - planning continues for the onboarding of the technical team post FID
Accommodation - progressing a number of options in and around Kalgoorlie
Offtake and Debt Financing
The Company was delighted with the strong interest received for offtake and project debt financing. The two groups who have provided the most attractive offtake and debt financing terms have been shortlisted and we have progressed to negotiating separate offtake and project debt financing agreements with both parties. We anticipate being in a position to execute binding agreements with one party in late June/early July 2023.
Final Investment Decision (FID) - Smelter Grade Concentrate (1.1Mtpa feed)
We are aiming for FID late June/early July 2023.
Expansion Project - Feasibility Study
Work continues on the Expansion Project which is based on treating 2.2Mtpa of mill feed and producing a rougher concentrate. The rougher concentrate product has a lower nickel grade and higher magnesium oxide content than conventional smelter feed and is more attractive as a feed for either pressure oxidation (POX) or high-pressure acid leach (HPAL) plants rather than a conventional nickel smelter. Metallurgical studies are continuing to determine the optimum rougher concentrate grade and metallurgical recovery and typical specifications to allow for potential offtakers to provide indicative terms. These terms will be a key component in determining the economics of the Expansion Project. Concentrate samples have been supplied to potential customers for testwork
Pure Battery Technologies Kalgoorlie pCAM Hub project - Modern Manufacturing Initiative - Conditional Grant Update Pure Battery Technologies (PBT) was awarded a $119.6 million conditional Modern Manufacturing Initiatives (MMI) Grant (reference number: MMIMCS000152) from the Federal Australian Government in March 2022 to advance their proposed battery material refinery hub project in Kalgoorlie (the Kalgoorlie pCAM Project) (refer ASX release titled '$119.6 million Modern Manufacturing Initiative Grant for Integrated Battery Material Refinery Hub in Kalgoorlie' dated 17 March 2022). PBT had been negotiating the terms of the conditional grant with the Department of Industry, Science and Resources and we understand that for various reasons, the Department has decided to discontinue further negotiations with PBT in respect of the grant. Whilst this is an understandably disappointing outcome for PBT and the critical minerals industry in WA generally, the decision by the Department of Industry, Science and Resources is of minimal impact to Poseidon given that: PBT and its proposed Kalgoorlie pCAM Project were one of a number of parties that Poseidon have been considering as potential offtakers for the Black Swan Expansion Project (rougher concentrate), some of which have existing HPAL projects in WA; none of the grant monies were ever intended for, or allocated to Poseidon or the Black Swan restart; the likely timing of development of the Kalgoorlie pCAM Project would not align with Poseidon's intended timing for the Black Swan Restart (subject to Final Investment Decision being made) and Poseidon is well advanced on finalising offtake and debt financing for the Black Swan smelter grade project with other parties. PBT has advised us they are proceeding with the bankable feasibility study for the Kalgoorlie pCAM Project and we intend to continue to provide support to PBT in terms of ore and concentrate samples for metallurgical testwork.
Contact:
Tel: + 61 (0)8 6167 6600
About Poseidon Nickel Limited
Poseidon Nickel Limited (ASX Code: POS) is a nickel sulphide exploration and development company with three projects located within a radius of 300km from Kalgoorlie in the Goldfields region of Western Australia and a resource base of around 400,000 tonnes of nickel and 180,000 ounces of gold. Poseidon's strategy is focused on the exploration and eventual restart of its established nickel operations in Western Australia with the aim of being a +15,000tpa nickel producer. A critical element of this strategy has been to acquire projects and operations with significant existing infrastructure, large nickel resources and geological prospectivity likely to lead to resource growth through the application of modern exploration techniques. Poseidon owns the Windarra, Black Swan and the Lake Johnston Nickel Projects. In addition to the mines and infrastructure including concentrators at Black Swan and Lake Johnston, these projects have significant exploration opportunities demonstrated by the discovery of the Golden Swan Resource at Black Swan and the Abi Rose mineralisation at Lake Johnston. The Company recently completed a Bankable Feasibility Study on Black Swan which will be the first project to restart. This will be followed by Lake Johnston and then Windarra, subject to favourable Feasibility Studies, appropriate project financing structures being achieved, the outlook for the nickel price remaining positive and all necessary approvals being obtained. The Company has completed a Definitive Feasibility Study on retreating the gold tailings at Windarra and Lancefield and has entered into a Heads of Agreement with Green Gold Projects whereby Green Gold will develop the project and Poseidon can retain an 8% free carried interest, subject to certain conditions precedent being satisfied.
POSEIDON NICKEL LIMITED 
