JUBILEE Mines has announced its intention to proceed with the development of a new underground decline in order to extend the life of its Cosmos nickel operation, 50 kilometres north of Leinster.
The decline will target an area below the Alec Mairs resource, adjacent to Jubilee’s Cosmos nickel operations, where drilling is reported to have returned significant nickel intersections.
The dual-purpose decline, to extend the underground complex by one kilometre, is estimated to cost $4.4 million, and will provide an additional underground exploration platform and enhance future production access to the Alec Mairs deposit.
Jubilee’s executive chairman, Kerry Harmanis, said the new decline, to be funded from internal revenue sources, would run below and parallel to the existing Alec Mairs exploration decline, and would provide flexibility and cost savings in the exploration and development of the area.
Jubilee announced its plan to access the Alec Mairs underground resource, which cost it half as much as the latest development proposal, to the market in August last year.
“It adds to us an excellent exploration platform, as we will have better angles for drilling, but will also provide us access to anomaly one,” Mr Harmanis said.
It is hoped the decline will extend the mine’s life, which commenced operations in 2000, costing around $55 million.
Since then Cosmos has consistently produced more than 11,000 tonnes of nickel annually.
“A number of high-grade nickel intersections returned from areas along the geological contact below and to the south of the Alec Mairs deposit indicate that the overall Cosmos-Alec Mairs system is more complex and extensive than originally contemplated,” Mr Harmanis said.
The new development proposal caps a successful six-month period for the West Perth-based company, with its share price increasing from around $4.10 in December to be trading at better than $6.57 when WA Business News went to press.
Mr Harmanis said the company had recently pursued an active exploration program at its portfolio of assets, which includes the Acra region, near the company’s Emu Lake prospect, 70km north-east of Kalgoorlie, through a strategic partnership with Pioneer Nickel.
The company has also increased its exploration focus at the Prospero deposit, which adjoins the southern boundary of the Cosmos nickel project, announcing in February significant high-grade drilling intersections of up to 11.3 metres at a grade 11.3 per cent nickel.
Mr Harmanis said recent cost increases in the industry had not greatly affected Jubilee’s operations.
He said the company currently had four diamond drilling rigs in the Cosmos area, but that getting hold of additional rigs for further exploration could prove difficult.
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