Ardea Resources Limited (ASX:ARL) (OTCMKTS:ARRRF) ("Ardea" or "the Company") is pleased to announce the results from its recently completed 2.25Mtpa Expansion Study at the Company's flagship Goongarrie Nickel Cobalt Project ("Goongarrie", "GNCP"). Goongarrie is a large mineral resource and this study evaluates the option of a higher throughput base case than that in the Pre-Feasibility Study ("PFS"). The Expansion Study showed significant improvements in the value of the project, the rate of return and the payback period compared to the 1.0Mtpa and 1.5Mtpa PFS results (see ASX announcement 28 March 2018).

Expansion Study Highlights- 2.25Mtpa over an initial 25-year mine life

- Annual production of over 10,000 tonnes of cobalt sulphate (2,100 tonnes contained cobalt) and over 81,000 tonnes of nickel sulphate (18,000 tonnes contained nickel)

- Enhanced NPV from previous PFS estimates
Case      Pre-tax NPV8      Unleveraged       Post-tax   Payback 
                            Post-tax NPV8     IRR 
2.25Mtpa  A$3.1 billion     A$2.3 billion     27 %       5.1 years 

Previous PFS results 
1.0Mtpa   A$1.43 billion    A$1.04 billion    25 %       5.3 years 
1.5Mtpa   A$1.93 billion    A$1.40 billion    25 %       5.6 years 

- Cobalt recovery of approximately 95 % and nickel recovery of approximately 93 % (life of mine)

- Initial capital cost of approximately A$1,165 million inclusive of 20% contingency

- Competitive LOM C1 cash cost of approximately US$4.63 / lb nickel metal (before cobalt credits)

- LOM C1 cash cost of approximately US($0.34) / lb nickel metal (after cobalt credits)

Key Points

- 2.25Mtpa base case is easily capable of further expansion using modular processing trains to reflect the true scale of the project

- The on-site neutraliser source also contains nickel and cobalt mineralisation, which could further reduce operating costs and provide up to an additional 10% production of nickel and cobalt sulphates (not included in the Expansion Study revenue stream)

- Further upgrade options include scandium production, High Purity Alumina production and in-pit neutraliser optimisation

- Definitive Feasibility Study (DFS) programs underway including a 7.5 tonne pilot run

- Goongarrie already attracting strong interest from potential strategic and offtake partners


The purpose of the 2.25Mtpa Goongarrie Expansion Study was to investigate the optimal throughput that could be achieved using one autoclave processing train. The positive results reflect the favourable metallurgical characteristics of the Goongarrie orebody which enables extremely short residence time in the autoclave, with no significant loss in metal recovery.

These outstanding metallurgical characteristics and rheology have resulted in an extremely robust unleveraged pre-tax NPV of approximately A$3.1 billion, with a pre-tax IRR of approximately 31% and a rapid payback period of 5.1 years for a 2.25Mtpa operation.

The 2.25Mtpa start-up option can easily be expanded by adding modular processing trains to take advantage of the full scale of Goongarrie's world-class resource base.

Commenting on the Expansion Study results, Ardea Executive Chair Katina Law said "We are pleased with the results of this Expansion Study as it highlights the upside potential of Goongarrie and its competitive economies of scale. The primary goal of the Company is to determine a cost-effective start-up scenario and also provide an upside case more suited to a financier or partner seeking a long life, lower cost, sustainable production base in a stable jurisdiction. The results have shown the benefits of scale, demonstrating Goongarrie as a unique battery metals project that can become a significant global producer over a long life."


1 - GNCP is part of the Kalgoorlie Nickel Project KNP, the developed world's largest cobalt resource

2 - The 28 March 2018 PFS announcement provide a 1.0Mtpa base case and a 1.5Mtpa option

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About Ardea Resources Ltd

Ardea Resources Ltd (ASX:ARL) (OTCMKTS:ARRRF) (FRA:A91) is an ASX listed resources company, with 100% controlled Australian based projects, prioritising a three-pronged value creation strategy which is:

- development of the Goongarrie Nickel Cobalt Project, which is part of the Kalgoorlie Nickel Project, a globally significant series of nickel-cobalt deposits which host the largest nickel-cobalt resource in the developed world, coincidentally located as a cover sequence overlying fertile orogenic gold targets;

- advanced-stage exploration at WA gold and nickel sulphide targets within the Eastern Goldfields world-class nickel-gold province; and

- the demerger of the NSW gold and base metal assets with planned in-specie share distribution, with projects located within the Lachlan Fold Belt world-class gold-copper province.



Ardea Resources Limited:
Katina Law
Executive Chair, Ardea Resources
Tel: +61-8-6244-5136

Media or Investor Inquiries:
Michael Weir, Citadel Magnus
Tel: +61-8-6160-4900

Link: 2.25Mtpa Goongarrie Nickel Cobalt Project Expansion Study

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Related Industry Topics:
Metals Materials General Mining Nickel Cobalt