The development of a lateritic base metals project in Western Australia’s North Eastern Goldfields, which has been on the radar for over two decades, took a significant step forward in the March quarter with the confirmation of its suitability for heap leaching. As a result, Alliance Nickel has secured an additional $1.2 million in unsecured loan facilities, along with an extension of existing loans totalling $4 million until the end of July 2026.
This funding will provide the junior miner with more time to attract further investors for the development of its $1.65 billion NiWest nickel-cobalt deposit, located approximately 650 kilometres northeast of Perth and about 50 kilometres southeast of Laverton.
The project delivered solid financial results in a definitive feasibility study (DFS) released late last year. The project is estimated to contain one of the highest-grade undeveloped nickel laterite resources in Australia, boasting a mineral resource estimate of 84.7 million tonnes at a grade of 0.94 per cent nickel and 0.06 per cent cobalt. Under this scenario, NiWest’s annual production is projected to be around 90,000 tonnes of nickel sulphate (approximately 20,000 tonnes of contained nickel) and about 7,700 tonnes of cobalt sulphate (1,600 tonnes of contained metal) for the first 12 years.
A life-of-mine (LOM) sustaining capital cost of $332 million over 35 years has been outlined, with a strategy to process higher-grade ore for the first 27 years, followed by an additional eight years of retreating previously mined and stockpiled low grade material.
Early works are planned to determine critical path activities necessary to achieve first production in the fourth quarter of 2027. This will encompass the development of the full project execution plan and schedule, as well as the formal tendering and awarding of engineering, procurement, and construction management (EPCM) contracts.
Confirmatory metallurgical test work and results analysis will also be completed. In March, Alliance announced the successful conclusion of an extensive confirmatory heap leach exercise, confirming last year’s laboratory results from closed-circuit column test work that verified both solubility and temperature set points critical for heap leach stages.
As part of the DFS, Ausenco conducted modelling simulations using computer-aided design (SysCAD) and OLISystems Incorporated’s software. These digital tools were instrumental in determining operating concentrations within the heap leach system for total dissolved solids (TDS) in liquor streams, as well as the temperatures required to maintain TDS concentrations in solution before refining.
The modelling indicated that only two stages of the heap leach required augmented temperatures to maintain solubility at high solute concentrations, prompting the setup of a closed circuit metallurgical program to simulate these phases. Two other ambient temperature stages in the design had already demonstrated solubility results in earlier column test work included in the DFS.
NiWest encompasses seven separate mining areas within a50-kilometre radius of the proposed plant site at Mt Kilkenny, located about 35 kilometres south of Glencore’s Murrin Murrin nickel operation, which features a high-pressure acid leaching(HPAL) plant and refinery that opened in mid-1999.
Originally established by Anaconda Nickel, driven by Andrew Forrest and supported by major investors Glencore and Anglo American, Murrin Murrin was one of three cash consuming and technically challenged HPAL projects launched in WA in the late 1990s.
The other two, Cawse and Bulong, failed within a few years due to their circuits’ inability to manage the nontronite found in their deposits.Interestingly, Murrin Murrin’s longevity can be traced back to Minara Resources, which incorporated heap leaching into its circuit during the early 2000s.
Another billion-dollar nickel-cobalt HPAL venture,BHP’s Ravensthorpe mine near Hopetoun, faced significant metallurgical challenges after its launch in 2008 and ceased operations within a year.
In its DFS, NiWest emphasised that its flowsheet represents the most cost-effective processing and refining approach, given the company’s unique laterite ore characteristics, lower technical and operational risks, and relative capital intensity compared to more capital-intensive HPAL operations.
The metallurgy and process design includes bulk column leach test work using two-metre-high columns and fresh water to generate a pregnant liquor solution (PLS), along with downstream PLS neutralisation, thickening, precipitation, and solvent extraction (SX) testing.
Additionally, four-metre-high confirmatory column heap leach tests using a synthetic saline leach solution based on closed-circuit water balance simulations were conducted to demonstrate the mitigation of precipitation in the heap.
The front-end engineering design (FEED) will evaluate the processing of saline PLS solutions through downstream unit operations and SX for nickel, cobalt, and zinc.
The impact of these results will be assessed against the DFS design and influence changes before commencing the detailed FEED procedure.
Currently, head grades delivered to the heap leach average1.06 per cent nickel and 0.07 per cent cobalt for the first 27 years, with projected steady-state recoveries of 78 per cent and 85 percent, respectively.
The DFS indicates compelling financial returns, including an un geared free cash flow of pre-tax $8.3 billion and post-tax$6.1 billion, a net present value of $2.2 billion (pre-tax) and $1.5billion (post-tax), as well as an internal rate of return of 21.1per cent (pre-tax) and 17.6 per cent (post-tax) with a five-year payback.
The targeted project timeline anticipates a final investment decision alongside preliminary project financing approvals in the second half of 2025. Given an estimated two-year construction period, first production is targeted for late 2027, subject to financing and necessary approvals.
This timeline assumes that regulatory and miscellaneous licence approvals are granted within expected timeframes, though several factors may introduce uncertainty.
It also presumes that nickel and cobalt pricing aligns with London Metal Exchange expectations of US$20,216 per tonne(real) for nickel, along with a premium for nickel sulphate and a product and cobalt price of US$32,556 per tonne.
Ongoing discussions with strategic partners are expected to continue positively to ensure financing aligns with timeline expectations.
Regarding the latest loan facility, long-term Alliance investorZeta Resources has agreed to an interest rate of 12 per cent perannum (capitalised until repayment), reflecting the interestcapitalisation structure and a new maturity date of 30 June 2026(or another date as agreed in writing).
“We appreciate the continued support from our lenders in extending these competitive, non-dilutive loans,” said AllianceManaging Director and CEO Paul Kopejtka. “This extension demonstrates strong confidence in our company and the NiWest project as we continue strategic discussions with multiple potential partners.”
