Largest Turnagain Nickel-Cobalt Resource – North of 60th Mining News
Positions Northern BC Battery Metal Mine Project for PFS North of 60 Mining News – October 28, 2022
On October 27, Giga Metals Corp. announced a 41.5% increase in measured and indicated resources at its Turnagain nickel-cobalt project in northern British Columbia.
Since the calculation of an updated resource in 2019, Giga Metals performed expansion and geotechnical drilling in preparation for a feasibility study for the battery metals project.
Based on 6,295 meters of drilling completed in 2021, as well as revised geological modeling, Turnagain now hosts 1.52 million metric tonnes of Measured and Indicated Resources averaging 0.21% (7.04 billion pounds) of nickel and 0.013% (433.1 million pounds) of cobalt; plus 1.22 million metric tonnes of inferred resources averaging 0.22% (5.56 billion pounds) nickel and 0.012% (325.3 million pounds) cobalt.
“The updated mineral resource estimate for the Turnagain Project represents an important milestone on the path to developing a large, long-lived operation,” said Giga Metals CEO Mark Jarvis. “Updated geological modeling has increased our level of certainty in contained resources to feed a nickel sulphide concentrate facility globally.”
In addition to drilling and geological modeling, the 2022 resource update benefited from higher prices for nickel and cobalt, metals in high demand due to their use in lithium-ion batteries powering electric vehicles. .
To secure potential future battery metals from the northern British Columbia mining project, Mitsubishi Corp. agreed to pay Giga approximately US$6.2 million (C$8 million) to acquire a 15% stake in Hard Creek Nickel Corp., a joint venture formed to advance Turnagain.
A 2020 preliminary economic assessment based on the 2019 resource estimate outlines plans for a mine at Turnagain that would produce an average of 33,215 metric tons of nickel and 1,962 metric tons of cobalt per year for 37 years.
At a nickel price of $7.50/lb, the Turnagain mine described in the 2020 PEA was calculated to have a pre-tax net present value deficit (8% reduction) of $269 million and a rate of internal yield of 6.3%. At $8.50/lb, the project is expected to have a pre-tax NPV (8% discount) of $242 million and an IRR of 9.4%.
Nickel is currently selling for over US$10/lb.
The next steps for the Hard Creek Nickel joint venture will be to use the significantly larger 2022 resource estimate as the basis for pre-feasibility and feasibility studies.
Engineering firm Tetra Tech is already conducting optimization studies ahead of a pre-feasibility study scheduled for completion in the first half of 2023 that will provide an updated mining scenario similar to the operation described in the PEA.
The JV is expected to carry out a separate study at the PFS level which will include the addition of a pressure oxidation circuit to convert the concentrate produced at Turnagain into a mixed hydroxide precipitate, which is the chemical form of nickel and cobalt currently the most requested by manufacturers of lithium-ion batteries.
“The potential addition of a pressure oxidation circuit to the process flow sheet will provide flexibility in terms of the form of nickel and cobalt the project will produce,” Giga Metals said President Martin Vydra earlier this year. “We know from discussions with battery manufacturers and automotive OEMs (Original Equipment Manufacturers) that this flexibility is important for end users. Our project needs to be well positioned to deliver everything customers want.”