Sabre Resources Ltd (ASX:SBR) has unveiled positive results of its Scoping Study on the company’s 70% owned Sherlock Bay Nickel -Copper-Cobalt Project, a significant nickel sulphide resource located on granted mining lease, M47/567, 40km east of Roebourne in the Pilbara Region of Western Australia.
The Scoping Study was initiated based on forecasts for rapidly increasing demand for battery metals such as nickel (Ni), copper (Cu) and cobalt (Co), for the electric vehicle and other renewable energy industries.
This increasing demand and supply issues are already having a significant positive impact on nickel prices, having risen by nearly 60% from just over US$15,000/t ($7/lb) at the start of the Scoping Study to a spot price of US$24,000/t ($10.90/lb).
In addition to the positive cashflow outcomes of the Scoping Study, the company has identified significant upside-potential for additional, high-grade, nickel sulphide resources below both the Symonds and Discovery resource zones which are increasing in grade and open at relatively shallow depth. Drilling is planned to target this higher-grade material, the discovery of which would have a significant impact on the potential financial viability of the Project.
Scoping Study Outcomes and Upside Opportunities:
- Production Target of 22.5Mt @ 0.36% Ni, 0.074% Cu, 0.016% Co (0.41% Ni Equ.) producing >70,000t Ni recovered in high-payability Mixed Hydroxide Product (MHP) on 100% project basis.
- Annual production approximately 6,000tpa of recovered nickel over 10/13 year mine/process life.
- At a cash-cost of US$6.60/lb Ni Equ. (US$14,500/t), generates pre-tax operating cash-flow, life of mine, ranging from A$180M to A$850M based on sensitivities (excl. all capital costs, before tax).
- Pre-production capital cost for processing plant and associated infrastructure: A$279M.
- The Project is cash-flow positive at “current” nickel pricing (At US$10/lb or US$22,040/t, 10-day average LME Ni for period ending 21/01/22) with projections of continued price appreciation based on global nickel consumption that is forecast to more than double by 20404 .
- Immediate upside for higher-grade extensions to both the Symonds and Discovery resources, that are increasing in Ni grade with depth and remain open, to be tested with new drilling planned.
CEO, Jon Dugdale, said the outcomes of the Sherlock Bay Nickel Sulphide Project Scoping Study indicate that the project is cashflow positive at current nickel prices.
“This is a very positive outcome as nickel as well as copper and cobalt prices are projected to continue increasing due to rapidly growing demand for critical lithium-ion battery components to power the electric vehicle and other renewable energy industries.
“The company has also identified potential for high-grade extensions to the Sherlock Bay nickel sulphide deposits that are improving in grade with depth.
“Drilling is planned to add high-grade resources that would potentially have a very positive impact on the economic viability of the Sherlock Bay Nickel Project.”
For further information please visit: https://www.sabresources.com/
