Canadian explorer Giga Metals [TSXV: GIGA] has released a Pre-Feasibility Study technical report which supports its earlier PEA on the Turnagain Project in British Columbia. This outlines a large, long life nickel mine with annual production projected to average 37,288 t/y of nickel and cobalt over the nominal full operating period.
Giga Metals said it expected the mine to have around a 30 year life span. The Turnagain project is regarded as among the largest undeveloped sulphide nickel deposits in the world. It is held in Hard Creek Nickel, which is a subsidiary company shared between Giga Metals (85%) and Mitsubishi Corp in Japan (15%).
Turnagain is considered to have excellent nickel product quality, at 18%, with the added bonus of 1.1% cobalt. It has a low carbon footprint and site operating costs of USD 3.85 per pound at site gate.
Giga Metals said that the project has positive economics, with a pre-tax IRR and NPV of 11.1% and USD 717m (7% discount rate). Post-tax IRR and NPV is 11.4% and USD 574m. This is based off a long term nickel price of USD 9.75 per pound, with 78% payability for nickel in concentrate.
Giga Metals to visit London
Mark Jarvis, CEO of Giga Metals, is visiting London this month and will be speaking at The Armchair Trader’s Beyond The Channel investor seminar on 30 November. If you are a professional investor and interested in meet Giga Metals at the event, please register for Beyond The Channel.
Large scale nickel projects in North America are going to be at a premium in the future, in our view. The supply chain for projected US giga factories has really not been fully mapped out, and an estimated 250,000 to 450,000 tons per year are likely to be needed in terms of raw feed to supply North American factories. That is a big ask.
Bear in mind most current nickel production is not suitable for batteries. In 2021 total refined production of nickel in North America was only 102,000 tons.
Another thing to consider is the US Inflation Reduction Act, passed last year, which aims to ensure more battery components are mined, refined or processed by the US or by its free trade allies. The goal here is to reduce dependence on Chinese critical minerals, ass neither China nor Indonesia – another major nickel producer – are US free trade allies.
Reliable clean nickel concentrate
Extensive metallurgical test work has shown that froth flotation can reliably create a high-grade clean concentrate, a very desirable product that can be upgraded to high purity Class One nickel for use in lithium-ion batteries. The cobalt produced is another critical element in battery production, adding to the long-term viability of the resource.
The Turnagain property lies immediately north of the Turnagain River near its confluence with Hard Creek, 65 kilometres east of the community of Dease Lake. Dease Lake is located on Highway 37, some 400 kilometres north of the Port of Stewart.
An 80 kilometre access trail extending easterly from Dease Lake extends into the Turnagain property and is used to haul equipment and supplies. A 900 metre long dirt airstrip, expanded in 2008 and situated within the claims area on the north side of Turnagain River, accommodates small aircraft.
Local geology for the Turnagain project
The Turnagain Nickel property covers the known extent of a zoned, Alaskan-type ultramafic intrusive complex in fault contact with Paleozoic to Early Mesozoic graphitic sedimentary rocks along its northern and eastern margins. The southern contact is not exposed, but several drill holes have penetrated the contact and intersected deformed, graphitic phyllites in fault contact with the ultramafic complex.
The Turnagain intrusion comprises a central core of dunite with bounding units of wehrlite, olivine clinopyroxenite, clinopyroxenite, hornblende clinopyroxenite, and hornblendite. The complex is elongate and broadly conformable to the northwesterly-trending regional structural grain.
