Alliance Nickel’s billion dollar NiWest nickel-cobalt project near Leonora has been awarded major project status by the Federal Government.
Alliance Nickel told the ASX on Thursday that major project status was awarded to Australian companies and projects identified to be strategically significant and having the potential to contribute considerably to the nation’s economic growth and employment opportunities.
The company said through the Major Projects Facilitation Agency, projects received additional support in navigating and co-ordinating complex Federal and State regulatory approvals for three years.
Alliance Nickel said major project status would support the rapid advancement of NiWest and came as global demand for US Inflation Reduction Act-compliant battery grade nickel and cobalt was growing.
The company said NiWest, about 55km east of Leonora and 30km from Glencore’s Murrin Murrin nickel-cobalt mine, contained one of Australia’s highest-grade undeveloped nickel laterite mineral resources and was targeting annual production of 90,000 tonnes of nickel sulphate and 7000 tonnes of cobalt sulphate.
It said the project was expected to create about 600 jobs during the construction phase and an additional 300 operational jobs.
The company said NiWest was the first Australian nickel project granted major project status since nickel was added to the critical minerals list by Federal Resources Minister Madeleine King in February.
Alliance said it was in continuing discussions with WA Government agencies to assist streamlining approvals as it looked to finalise a definitive feasibility study in the second half of the year.
Managing director and chief executive Paul Kopejtka said the company was pleased NiWest had been recognised by the Federal Government as a project of national significance.
“The NiWest project is now recognised as significant from an industry and economic perspective and we look forward to working closely with relevant ministers, Government and industry bodies as we move towards construction,” he said.
An updated pre-feasibility study in July 2022 allocated a post-tax net present value to NiWest of $1.1 billion to $2.1b, based on nickel price case scenarios of US$9/lb to US$11/lb, and cobalt price cases of US$28.50/lb to US$35/lb.
Nickel was this week trading at US$8.50/lb.
Alliance had planned to produce its definitive feasibility study last year but in October said it was grappling with rising cost estimates.
Mr Kopejtka said the timing of completion for certain workstreams had affected when the overall study could be finished.
“While being disappointing, the board considers it prudent that it takes the necessary time to ensure all aspects of the project are advanced and completed diligently and comprehensively,” he said.
“Given the ongoing advanced progress of other project workstreams, completion of the DFS next year should not have a material impact on the overall project execution schedule.”
Since then the WA nickel industry has been plunged into crisis as cheap Indonesian product depresses the global price.
First Quantum Minerals last month said its Ravensthorpe mine would be shuttered and 530 jobs cut.
Wyloo Metals will put its Kambalda operations into care and maintenance at the end of this month, affecting more than 260 jobs.
The axe continues to hover over the 3300 jobs associated with BHP Nickel West’s operations in the State, with a decision expected in August.