THE BOURSE WHISPERER: Sirius Resources (ASX: SIR) has commenced development of the Nova nickel mine and construction of associated infrastructure.
Sirius kicked off mining operations on the Australia Day public holiday having received final statutory approvals required for the commencement of operations on the mining lease.
The milestone comes two and a half years since the discovery of Nova, and exactly on the project’s planned timeline.
Sirius already had pre-positioned contractors on site in anticipation of the approvals for mining operations to begin, which are now underway alongside other key construction activities.
The competitive nature for contractors being generated by the current state of the industry has enabled Sirius to identify capital cost savings of $30 million on the original Definitive Feasibility Study estimate of $473 million, bringing that figure down to $443 million.
“We have started the project on time, on plan and significantly within original capex budget estimates,” Sirius Resources managing director Mark Bennett said in the company’s announcement to the Australian Securities Exchange.
“I would like to thank the WA Environmental Protection Agency, the Department of Mines and Petroleum, and the Department of Environment Regulation for their professional and efficient participation in this process.
“It is also pleasing to continue involving local stakeholders such as the traditional owners and local pastoralists in the venture.
“Our project management team have done a great job getting Sirius to this point so smoothly, so quickly and with the benefit of significant savings.”
Initial mining of the boxcut (the small open pit excavated to access fresh rock from which the underground decline starts) is expected to take approximately three months to complete.
Start of mining at Nova – the boxcut site on Australia Day, Monday 26th January 2014. Source: Company announcement
Immediately following this, mining of the underground decline to access the Nova orebody will commence.
The exploration camp is currently being expanded and converted to become a 200 person temporary construction camp to house the workforce whilst the main accommodation village is being built.
This work is due to be finished in March 2015, and the permanent accommodation village is expected to be completed by August 2015 at a cost of $23 million.