THE BOURSE WHISPERER: InterMet Resources (ASX: ITT) has executed a binding Option Agreement with Rossiter Minerals for an exclusive six month option to acquire an 80 per cent interest in the Calypso nickel sulphide project located in Western Australia.

InterMet described the Calypso project as an early-stage nickel exploration project.

It is located north of Kalgoorlie within the southern extent of the Agnew-Wiluna Nickel Belt, a nickel sulphide province that hosts world-class deposits including Mt Keith, Perseverance Pit, Honeymoon Well and Cosmos Deeps.

“Given the prospectivity of the Agnew-Wiluna Belt, the acquisition of the Calypso project is an exciting exploration opportunity for InterMet,” InterMet Resources director Andrew Richards said in the company’s announcement to the Australian Securities Exchange.

“As we work together with Cygnet Capital to restructure InterMet as an emerging resources company, the Option represents a significant milestone.”

InterMet will conduct a due diligence program focusing on confirming the presence of disseminated sulphides that were encountered in ultramafic rocks by BHP Minerals during purely gold-focussed exploration in the mid-1980s.

 

Aeromagnetic image showing location of Zeus and Argo prospects within the Calypso nickel project. Source: Company announcement

 

According to InterMet, BHP Minerals described intersecting the sulphides in consecutive holes on a single line of shallow aircore drilling over the Zeus prospect.

Zeus is one of two discrete, intense aeromagnetic anomalies of approximately one kilometre BHP Minerals identified within the Calypso project.

Zeus and the other aeromagnetic anomaly, Argo, will be the focus of InterMet’s due diligence during the term of the Option.

InterMet plans to twin the BHP drill holes in an attempt to confirm the presence of nickel mineralisation and review the existing relationship between the anomalies and the previous sampling results to establish the potential of these prospects.

InterMet shares were unchanged at 2.5 cents.

THE BOURSE WHISPERER: Potash West (ASX: PWN) has received the results of a recently-completed Scoping Study carried out on the company’s wholly-owned Dandaragan Trough potash project, located 150 kilometres north of Perth in Western Australia.

According to the company the study has produced positive results, demonstrating the potential of Dandaragan Trough to be a viable, very long term project.

The Scoping Study also demonstrated the robust nature of Potash West’s proprietary K-Max processing process and provides Potash West with the confidence to move forward towards a Definitive Feasibility Study (DFS).

The study considered two production rates: 4 million tonnes per annum and a smaller start-up case of 2.4Mtpa.

The latter rate was identified during the study to be more suited to the immediate market demand for products in the local region.

The project is based on the JORC compliant resource outlined at Dinner Hill, which is only a small part of the Dandaragan Trough project area.

 

Land tenure Dandaragan Trough project. Source: Company announcement

 

The key outcomes for each production rate are:

2.4 Million tonnes per annum

Mine life +60 years
Average revenues per year $365 million
Operating cash costs per year $137 million
IRR 21 per cent
NPV10 $808 million
Capital cost $650 million

4 Million tonnes per annum

Mine life 39 years
Average revenues per year $547 million
Operating cash costs per year $234 million
IRR 20.7 per cent
NPV10 $1,163 million
Capital cost $880 million

Other outcome identified included:

–    Opportunities for capital and operating cost reduction by continued process improvements; and

–    Glauconite mineralisation is extensive and opportunity exists to increase scale significantly and relatively easily as operations are established and markets grow in region.

“This is a significant study for Potash West and its shareholders,” Potash West managing director Patrick McManus said in the company’s announcement to the Australian Securities Exchange.

“The study brings together many months of work, carried out by our partners and external consultants, all highly qualified in their fields.

“The study shows that the Dandaragan Trough has capacity to be a technically and financially viable project, with strong operating margins, and has the potential to be expanded significantly, as markets are developed.

“The project benefits from its location in Western Australia, with high quality infrastructure and a ready market for fertiliser products.

“We believe we are in a position to capitalise on the long-term dynamic of increasing demand for high-quality materials feeding the food supply and agricultural industries.”

THE BOURSE WHISPERER: Atlantic Gold (ASX: ATV) has made progress with its surface lands acquisition program over the footprint of the company’s Touquoy gold project in Nova Scotia, Canada.

The company said it had secured possession of four of the last five remaining non-Crown titles, from a total of 63 private properties required for development of the project, in mid-December 2012, which it had expected, under the provisions of the Expropriation Act.

However, the vesting order issued by the Nova Scotia Minister of Natural Resources in relation to the one remaining property is subject to appeal by the former landowner.

At this time the appeal is set to be heard in April 2013.

Atlantic said two preliminary matters have now been brought before the Court.

The first matter, that interveners be permitted to participate in the appeal, was heard on 19 November 2012 with the Court delivering its decision that the Nova Scotia Federation of Agriculture was granted intervener status.

However, counsel for the Appellant spoke on behalf of this Federation at the motion, of which the Court noted a potential conflict of interest and expressed serious concerns if counsel for the Appellant continued to speak on behalf of the Federation.

The Mining Association of Nova Scotia was also granted intervener status.

“The decision to add these interveners was made on the basis it would neither slow the process nor unduly prejudice any party,” Atlantic Gold said in its ASX announcement.

The second matter involved a motion by the Appellant to have the appeal heard as a trial de novo rather than an appeal on the record.

This motion was heard on 3 January 2013 with the Court making an immediate decision, dismissing the Appellant’s motion.

“Although anxious to expedite this process, the company is nevertheless satisfied with these outcomes,” Atlantic said.

“It firmly believes the Minister’s decision was made in accordance with the process set out under Nova Scotia’s Mineral Resources Act and remains confident that this appeal will be dismissed.”

THE BOURSE WHISPERER: Discovery Metals (ASX: DML) has hit a temporary roadblock to ore milling at the company’s Boseto copper project in Botswana.

The interruption has been caused by the failure of a bearing in the ball mill gearbox, which was detected on 24 December.

The company originally anticipated the shutdown would be for a short duration as the required parts for the repair were on site at Boseto.

The mill manufacturer’s engineers were called to site for warranty and quality control reasons and the subsequent dis-assembly of the gearbox detected possible metal contamination within the assembly.

This meant the complete assembly was required to be sent to Johannesburg for expert re-assembly., which is now underway.

“The mill is planned to be in operation within a week and then will process the crushed ore stockpile which continues to build up as ore mining and crushing operations continue at full production rates,” Discovery Metals said in the company’s ASX announcement.

“Further details will be provided in the December Boseto Commissioning Update, which will be published next week.”

THE BOURSE WHISPERER: Atlas Iron (ASX: AGO) has commenced production at the company’s third Pilbara iron ore mine, Mt Dove, located 65km south of Port Hedland in Western Australia.

Atlas considers the commencement of production at Mt Dove to be a major steppingstone towards achieving the company’s near-term Horizon 1 production target of 12 million tonnes per annum.

 

Crushing and screening at the Mt Dove mine. Source: Company announcement

 

“Atlas has a proven track record in Pilbara mine development having now brought three mines into production within four years,” Atlas Iron managing director Ken Brinsden said in the company’s announcement to the Australian Securities Exchange.

“The company is on target to bring five mines into production in five years with the addition of the Abydos Mine in June 2013, and the first phase of the Mt Webber Mine – subject to Board approval – in December 2013.”

With the commencement of production and haulage at Mt Dove, Atlas remains on track to export between 7.2 million tonnes and 7.7 million tonnes of iron ore in the 2013 financial year.

Disclaimer: The Resources Roadhouse owns Atlas Iron shares