Poseidon Nickel Ltd (ASX:POS, OTC:PSDNF, FRA:NYG1) has enhanced the Black Swan Project in Western Australia by way of a maiden resource estimate for the Silver Swan Tailings (SST) of 6,200 tonnes of nickel and 460 tonnes of cobalt.
The SST resource of 675,000 tonnes at 0.92% nickel and 683 ppm cobalt supports the concept to co-process SST with Black Swan Disseminated (BSD) open pit ore.
This would increase the Fe:MgO ratio of Black Swan product and thus improve its marketability while also aligning with Poseidon’s ‘Fill the Mill’ strategy for the project.
Filling the mill
Managing director and CEO Peter Harold said: “The Silver Swan Tailings are a low cost, high Fe:MgO ratio ore feed for our 'Fill The Mill' strategy.
"Combining the Silver Swan tails with the Black Swan disseminated ore feed significantly improves the saleability of the Black Swan concentrate product and will assist with our discussions with potential off-takers as we progress toward a production restart.”
Measured resource tabulation of the Silver Swan Tailings.
The estimate is the result of a 2018 sonic drilling program over the SST impoundment that saw a block model generated.
Sonic drilling is ideally suited to tailings evaluation as there is no injection of water or other drilling fluids and no use of compressed air to disturb the tailings.
The rig generates a solid tube of tailings which is collected in a plastic sleeve, which helps retain moisture for subsequent determinations. Typically, half ‘core’ is submitted for assay using conventional XRF with a fused borate disk.
Block model reviewed
In August 2021, Poseidon engaged Optiro Pty Ltd to review the block model along with the drilling Quality Assurance/Quality Control (QAQC) and carry out a site visit to the SST.
Accordingly, Optiro endorsed the block model as being representative of the drilling and has reported and classified the tailings according to the JORC Code (2012) as a measured mineral resource.
The SST was divided into three zones based on the chemistry of the drilling samples.
East-west section, looking north, showing the three estimation zones (grid squares are 5 metres).
Zone 3, or the top zone, approximately represents the top metre of the tailings with samples characterised by relatively high magnesium oxide (MgO), low iron, low nickel and sulphur and low cobalt and reflect partially the results of surface oxidation and partly a lower-grade feed source.
Zone 1, below the surface zone, has samples with moderate nickel, lower iron and lower cobalt, and reflects tailings from the Silver Swan orebody, but with relatively high nickel recovery, hence lower tailings grade.
Higher grade zone
The lowest zone, Zone 2, which contains just under half the total tonnage, also represents tailings from the higher grade, massive sulphide portions of Silver Swan and is characterised by high nickel, cobalt and iron and very low MgO.
Zone 2 reflects lower metallurgical recoveries during the earlier part of mining at Silver Swan and has a small, oxidized layer at its top, reflecting a pause in tailings deposition.
Poseidon is considering removing the top zone, which is around 1-metre in thickness, since it is much higher in MgO content, with an average grade of 19%, with a low nickel grade (0.4%). Importantly, the Fe:MgO ratio in-situ is low at 0.5:1.
Once this has been removed, the underlying material has an Fe:MgO ratio in-situ such that it can be blended in with fresh material to be mined from the Black Swan pit, material from the recommencement of mining in the lower levels of Silver Swan and potentially with material from Golden Swan mineralisation, which has yet to have a declared mineral resource.
Block model view, looking northwest, coloured on estimated nickel grade together with drilling.
Positive test results
Along with the estimate, metallurgical test-work was also carried out on four composites selected to represent the four quadrants of the SST dam and this resulted in:
- Nickel recovery of 48% to a rougher flotation concentrate;
- Fe:MgO ratio >10:1;
- Excellent repeatability in the results between the composites tested; and
- Detailed mineralogy confirmed nickel (primarily as pentlandite) and iron sulphides (pyrrhotite/pyrite) reported to flotation concentrate, while rejecting the majority of the MgO.
Supporting the company’s concept, the test results also reveal that a low proportion of SST, less than 10%, would require to be co-processed while there would be an opportunity to improve the Fe:MgO ratio further by incorporating a cleaner flotation stage.
As a result, detailed test-work is underway to optimise the SST blend ratio and test the optimal blend ratio with appropriate proportions of the Silver Swan and Golden Swan massive sulphides.
The results of this work will support a bankable feasibility study (BFS) on restarting the Black Swan Concentrator at the 1.1 million tonnes annual production rate. Other positive factors are:
- SST material is already at the required grind size for flotation;
- Low opex to reclaim and ‘co-process’; and
- Measured resource provides plus-six years of mining inventory for blending.
In a further positive development for Black Swan, the company has signed a five-year agreement with Norton Gold Fields Pty Ltd to access large standing water reserves at NGF’s Golden Cities and Mulgarrie open cut mines.
Access to this water would utilise Poseidon’s existing 24-kilometre Federal Pit pipeline infrastructure.
This also complements the proposed restart at Black Swan Concentrator and facilitates the potential to ramp-up to nameplate throughput of 2.2 million tonnes per annum, subject to availability of ore feed and market conditions.