Poseidon Nickel Ltd (ASX:POS, OTC:PSDNF) has lifted nickel resources as well as grades in an updated mineral resource estimate (MRE) for the Black Swan Project in Western Australia.
This new disseminated MRE includes results from recent underground drill programs undertaken from the Gosling drill drive and returned an increase in the overall tonnes of contained nickel.
Black Swan disseminated sulphide deposit now contains 28.9 million tonnes at 0.63% nickel for 181,000 tonnes of contained nickel at a 0.4% cut-off, an increase of approximately 10,000 tonnes of nickel and at a higher average grade
Significantly, measured and indicated resources have 35% more contained nickel compared to the 2104 estimate and total 10.7 million tonnes at 0.75% nickel for 80,000 tonnes of nickel.
The revised MRE drew a positive response from investors, with POS shares rising as much as 8.52% to A$0.051 and more than 16 million shares changed hands.
Results further de-risk Black Swan restart
“The update of the Black Swan disseminated resource is an important milestone for our 'Fill the Mill' strategy," said Poseidon managing director and CEO Peter Harold.
"Black Swan has a 2.2 million tonnes per annum process plant (mill) and our strategy is to ‘Fill the Mill’ to leverage off the existing infrastructure and large resource base at Black Swan.
“We are pleased the update has resulted in both an increase in the overall tonnes of contained nickel together with an increase in the inventory of the measured and indicated resources.
"Most importantly, the recent drilling has provided an improved understanding of the disseminated grade distribution within the metallurgically important serpentinite and talc-carbonate hosted ores below the existing Black Swan open pit. The improved metallurgical understanding is key to further de-risking the restart of Black Swan.
"Work is well advanced on optimising the pit shell designs from the new MRE and from the underground mining studies at Silver Swan and Golden Swan. Once completed, this work will allow the updating of ore reserves for the Black Swan Project to underpin the Bankable Feasibility Study.”
MRE includes 5,144 metres of new drilling
The latest MRE, prepared by independent resource consultants Golder Associates Pty Ltd using available assay data as at June 2022, replaces the 2014 MRE which reported 29.1 million tonnes at 0.59% nickel for 170,900 tonnes of nickel.
This updated MRE incorporates 5,144 metres of new drilling from 24 diamond drill holes (DDH) completed by Poseidon between October 2021 and March 2022 and 14 RC holes (2,481 metres) completed in 2019. Both programs were completed from underground using the Gosling access drive.
The recent 24-hole drill program was specifically undertaken to increase confidence in the Black Swan MRE, by infilling the area extending about 125 metres immediately below the existing Black Swan open pit with the aim of better delineating the metallurgically important serpentinite and talc-carbonate hosted resources in this area.
Poseidon said Golder was engaged in March 2022 to update the Black Swan MRE with the objective of quantifying the current resource following recent drilling and to create a block model for ongoing mine planning studies as part of a Black Swan Project Bankable Feasibility Study (BFS).
About Poseidon
Poseidon is a nickel sulphide exploration and development company with three projects within a 300-kilometre radius from Kalgoorlie in the Goldfields region of Western Australia.
The company's strategy is focused on the exploration and eventual restart of its established nickel operations in Western Australia.
A critical element of this strategy has been to acquire projects and operations with significant existing infrastructure, large nickel resources and geological prospects that are likely to lead to resource growth through the application of modern exploration techniques.
Apart from Black Swan, Poseidon also owns the Windarra and the Lake Johnston nickel projects.
Black Swan will be the first project to restart, followed by Lake Johnston and Windarra, subject to favourable feasibility studies, appropriate project financing, positive nickel price outlook and all necessary approvals being obtained.