Mt Thirsty (www.mtthirstycobalt.com)

Mt Thirsty Location Plan
Mt Thirsty Location Plan

The Mt Thirsty Project is a 50/50 joint venture between Barra and the manager of the project, Conico Ltd (ASX : CNJ). The project is located 20km north-northwest of Norseman, Western Australia.

Cobalt-Nickel Oxide Deposit

Independent mining and geological consultants Golder Associates Pty Ltd estimated a JORC 2004 compliant Indicated and Inferred Mineral Resource as follows:

The total Indicated and Inferred Mineral Resource above contains approximately 177,000 tonnes of nickel, 40,000 tonnes of cobalt and 274,000 tonnes of manganese.

The Mt Thirsty Cobalt-Nickel Oxide deposit differs significantly from typical WA nickel laterite occurrences in that it is completely oxidized and contains high cobalt values. The mineralogy of the deposit allows leaching recoveries of approximately 95% cobalt and 80% nickel. This makes the deposit very amenable to atmospheric leaching techniques which don’t require expensive and problematic autoclaves.

Due to the intense oxidation of the deposit, mining will be extremely low cost as there will be no need for blasting prior to excavation. The majority of the deposit is shallow and flat lying, occurring only 10-15m below surface. Another advantage to the deposit is the location of the high grade resource zones. They are situated closest to the surface allowing the deposit to be high-graded during the first 3-4 years of production, dramatically reducing capital payback.

Metallurgical testing and pre-feasibility work highlighted the potential world class nature of this outstanding project. The Mt Thirsty Project has the potential to emerge as one of the world’s top ten cobalt suppliers with capacity to deliver 3,000t of cobalt, 9,000t of nickel and 13,000t of manganese per annum during the first 3 years of production.

Schematic cross section of the Mt Thirsty oxide resource that has the potential to be one of the lowest cost cobalt leaching operations in the world.

Metallurgical test work, initiated in 2012 was conducted to assess the viability of leaching the Mt Thirsty oxide resource using sodium metabisulphite.

Consultants RMDSTEM completed the metallurgical testwork and research to establish the lowest capital and operating cost process which also delivered maximum metal recoveries.
Preliminary leaching tests using sodium metabisulphite via the proprietary INNOVAT continuous vat leaching (CVL) process were encouraging.

More extensive testwork in 2013 resulted in modification to the INNOVAT – CVL process and major developments include the use of the cheaper and more efficient option of sulphur dioxide (SO2) rather than metabisulphite as the main leaching agent. Also, the conclusion that an agitated leach process is a more practical and economic alternative to continuous vat leaching.

Based on mining 12.5 million tonnes from the Indicated Mineral Resource, two 900,000 tonnes per annum conceptual flowsheets are currently under investigation. One utilising a paste thickener (Thickener) and the other using an ion exchange resin-in-pulp (RIP). Early studies indicate both flowsheet options have similar capital requirements of approximately $65-70 million (including 30% contingencies on plant and equipment and $20 million for site infrastructure). Unit operating costs were estimated at $5.50/pound of cobalt for the RIP option and $5.55/pound of cobalt for the Thickener option.

The major external risk factors are exchange rate and cobalt price. Whilst the major internal factors are cobalt head grade, payable cobalt and leach recovery rate.
The low capital cost and the fact that cobalt prices would have to fall by over 30% for a zero return justifies continued work to progress to a pre-feasibility stage.

Nickel Sulphide Mineralisation

In addition to the Cobalt-Nickel Oxide Resource, the Mt Thirsty Project has proven potential to host primary nickel sulphide mineralisation within the same ultramafic sequence that hosts the oxide resource.

The thick sequence of altered olivine-rich, cumulate-textured ultramafic rocks contain semi-massive, stringer and disseminated nickel sulphide mineralisation. The footwall contact where the best concentration of nickel sulphides might be expected has been systematically tested with RC and diamond drilling. RC drilling to date has returned nickel sulphide intersections including 6m @ 3.4% nickel, 2m @ 5.9% nickel, 2m @ 3.5% nickel and 1m @ 4.0% nickel.

Longitudinal section showing nickel sulphide intersections.

Longitudinal section showing nickel sulphide intersections. Diamond drillhole 28 demonstrated the nickel sulphide mineralisation has been terminated by a flat lying pegmatite dyke at least 220m thick.

A moving‐loop electromagnetic survey (MLEM) was completed in September 2013 over tenements E63/373 and E63/1267 testing for nickel sulphide conductors. The survey identified a total of seven MLEM conductors: 3 x Category ‐ 1 (highest priority), 3 x Category ‐ 2 (high priority) and 1 x Category‐4 (lowest priority).

Image showing location conductors identified from 2013 MLEM survey