Poseidon Nickel (ASX: POS, 'the Company') is pleased to report capital and operating cost estimates for the refurbishment and operation of the Lake Johnston processing plant and associated infrastructure.
The estimates were provided within an Engineering Study completed by GR Engineering Services Limited ('GRES') (ASX Code GNG).
Note that the Engineering Study completed by GRES is not a scoping study nor a feasibility study for restarting the Lake Johnston project. The primary outcomes from the study are capital and operating cost estimates which the Company will use for internal purposes to make strategic decisions on the future of the project. Managing Director and CEO, Peter Harold, commented: 'The results from the Engineering Study show that the Lake Johnston plant could be refurbished for a very modest $31 million over a seven-month period.
Similar to the Black Swan Project, the estimated refurbishment costs and time are a fraction of what it would take to build a new processing plant and the associated infrastructure such as the 200 person village, tailings dam, airstrip, etc. We see Lake Johnston as our next nickel sulphide mining and processing operation which could come on stream sometime after we recommence operations at Black Swan. If we can get both Black Swan and Lake Johnston back into production we could achieve one of our stated corporate objectives of producing at least 15,000 tonnes per annum of nickel in concentrate
On 27 January 2022, Poseidon Nickel Limited (Poseidon, the Company) (ASX: POS) released an announcement titled Lake Johnston Engineering Scoping Study Completed (Announcement).
The Announcement was to inform the market of a recently completed Plant Capital and Operating Cost Estimates Report for the Lake Johnston project, however it was erroneously titled and referred to as an 'Engineering Scoping Study'.
The Company has subsequently amended the announcement and advises the following changes: Removing the reference to 'Scoping Study' in the title of the announcement and within the body of the announcement
Providing clarity that the study completed was not a scoping study nor a feasibility study
Reference to sources for historical data for previous production data
Inclusion of the Mineral Resource Statement and Competent Person Statement
Capital cost estimates
GRES estimated that the cost to refurbish the plant and associated infrastructure (including engineering, procurement, construction and management costs) to be approximately $31 million. Estimated refurbishment schedule is seven months, which assumes power supply (historically diesel generators owned and operated by an external provider) can be supplied and installed within this period.
The Company will review the previous studies on mining the remaining Maggie Hays resource and start an aggressive exploration program aimed at increasing the resource base at Lake Johnston. Following completion of NewExco's exploration targeting review (refer to Announcement 'Quarterly Report 30 September 2021' released on the 29 October 2021 for further details), the Company has appointed a Senior Exploration Geologist and lodged a Program of Work (PoW) with the Department of Mines, Industry Regulation and Safety (DMIRS), for the recommencement of exploration activities at Lake Johnston.
The initial exploration program will consist of up to 250 holes on 43 lines, drilling up to 15,000 metres targeting the high priority Western Ultramafic unit.
Contact:
Peter Harold
Tel: + 61 (0)8 6167 6600
POSEIDON NICKEL LIMITED 
