Cassini Resources Ltd
Quarterly Activities Report
Period ended 30 September 2019
A Mineral Resource update was released in April 2019 incorporating drilling up to December 2018. In that release Indicated Resources were increased from 40% to 60% of the total Mineral Resource compared to the previous release. Since December 2018 approximately 50,000m of infill drilling has been completed with a focus on increasing the proportion of Indicated Resources sufficiently to underpin an Ore Reserve once the PFS is completed. This drilling was completed during the Quarter and rigs demobilised from site. A Mineral Resource update including drilling from January to August is in preparation to support close out of the pre-feasibility study and completion of a maiden Ore Reserve, with an anticipated improvement in resource classification underpinning both.
A Mining 'Hill of Value' study has been completed to select the optimum processing rate and mining cutoff grade. The PFS has confirmed 10Mtpa as the optimum processing rate as contemplated in the Further Scoping Study, but improving the intial 8 years of mine life to beyond 15 years.
A detailed mine design, stockpiling strategy, operating cut-off grade and waste dump strategy have also been completed.
Metallurgical Flowsheet Development
An alternate flotation flowsheet to the Sequential Separation flowsheet which was the basis for the Further Scoping Study has been tested to sufficient confidence to be included in the Base Case. This alternate Bulk Separation flotation flowsheet is used in the majority of copper-nickel projects worldwide that produce separate copper and nickel concentrates. In the Bulk Separation flowsheet, nickel and copper are floated together into a single cleaned concentrate and then separated into two products.
Bulk separation enables primary grind size to be increased from 75 microns to 165 microns which results in a capital cost and operating cost savings. While the Bulk Separation flowsheet has been tested with sufficient confidence to be included in the Base Case, further de-risking will be undertaken through locked cycle testing and a pilot plant later this year.
The study has identified three alternative processing technologies to that assumed in the Further Scoping Study that are not yet incorporated in the Base Case; the Loesche Mill, Woodgrove Flotation Cell and Hydro-float Cell. All of which are still to be fully tested and proved, but all of which have the potential to further reduce capital costs and operating costs and improve metal recoveries. Work on the Loesche Mill technology is the most advanced of these three. Two pilots of the Loesche Mill have now been completed. This work confirmed the previous finding that a significant reduction in power consumption is possible and the use of expensive grinding media is completely eliminated.
A 55 MW hybrid diesel-solar-wind solution with 70-80% renewable penetration is the current Base Case. Baseline data collected over the last year has demonstrated a high quality, consistent solar and wind resource is available, with higher wind velocities at night offsetting the lack of solar power.
Power accounts for around 40% of the processing cost at West Musgrave and is a significant value lever on the project. Large-scale solar photovoltaic and wind solutions are currently economically viable and technically mature solutions to reduce the project's reliance on high cost fossil fuels for electricity generation.
A large number of proposals have been received from major utilities, independent power providers, infrastructure funders and equipment manufacturers. Evaluation of the proposals has resulted in