Western Areas NL

Published : October 01st, 2015

Cosmos Nickel Complex Acquisition Completed

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Cosmos Nickel Complex Acquisition Completed

6c41ee8a3bc3984c1d6702.pdf


1 October 2015 ASX: WSA


WESTERN AREAS COMPLETES THE ACQUISITION OF THE COSMOS NICKEL COMPLEX

JORC 2012 Resource Compliance Completed by Western Areas


Western Areas Ltd (ASX:WSA, 'Western Areas' or the 'Company'), through its 100% owned subsidiary Australian Nickel Investments Pty Ltd, is pleased to announce that it has completed the previously announced acquisition of the Cosmos Nickel Complex ('CNC') from Xstrata Nickel Australasia Operations Pty Ltd ('XNAO'), a subsidiary of Glencore plc.


The completion of the transaction follows satisfaction of the conditions precedent. Accordingly, Western Areas has paid its first instalment of A$11.5m in cash, from the total consideration of A$24.5m. Future payments are due on 1 July 2016 (A$7.0m) and 1 April 2017 (A$6.0m).


The Company has also completed a review of the acquired nickel resources in accordance with JORC 2012, confirming a total of 567,297 nickel tonnes to the CNC Total Mineral Resources (see Table 1), which is a significant addition to the Company's resource portfolio.


Previously Announced Acquisition Highlights:

  • World class nickel belt which has yielded one of the highest grade nickel mines ever discovered and operated;

  • Substantial exploration opportunities in areas which remain largely untested - 24 month program ready to commence on day one;

  • Third potential underground mine with the undeveloped Odysseus high grade deposit hosting a total Mineral Resource of 7.3 million tonnes @ 2.4% nickel containing 174,000 tonnes of nickel;

  • Extensive and well maintained operating infrastructure including a 450ktpa concentrator, a new SAG mill and large accommodation village to support an early start-up; and

  • Consistent with Western Areas' core strengths - exploration, development, underground mining and conventional flotation utilising a well proven low cost operating model.


    Western Areas will now commence the formal process of registering the transfer of the associated mining and exploration tenements with the Department of Mines and Petroleum.


    Western Areas Managing Director, Mr Dan Lougher, commented that the completion of the CNC acquisition is an exciting milestone for the Company.


    'The completion of this acquisition meets one of our strategic objectives of acquiring a brownfields growth project, in addition to growth opportunities identified at Forrestania. We firmly believe that the Cosmos Nickel Complex provides the Company with significant upside from both an exploration front and a very attractive potential new mining operation.'


    'The Cosmos Nickel Complex area has significant infrastructure in place, was under explored by the previous owner and hosts one of the world's premier high grade nickel belts. The Odysseus deposit holds some high grade massive sulphide intersections of up to 12% nickel which we will be looking to expand upon in the future. '


    'We are working very closely with our geophysical partner, NewExco, on the surface geophysics program, whilst our in-house mining and project team looks to advance Odysseus as a potential new underground mine in a staged and disciplined manner using our low cost operating model.'


    'The operations team has already identified idle equipment, such as a new ventilation fan system and mine refuge chambers which can be transported to Forrestania and drive significant cost savings in excess of A$2m', said Mr Lougher.


    Ventilation Fans Mine Refuge Chambers


    Immediate Plans for CNC

    Today, the Company's operations team has taken control of the CNC, located just outside Leinster. During the time up to completion, detailed planning for activities from day one were completed and are now being implemented. Some of these plans include, but are not limited to the following:


  • Implementing safety and other site operational protocols in line with Western Areas standards;

  • Engagement with local contractors to complete initial site improvements;

  • Engagement with local heritage groups;

  • Tenement wide surface geophysical program using the latest deep sensing technology for additional target generation for calendar year 2015;

  • Integration, review and commencement of study work associated with the Odysseus Project; and

  • Evaluating and driving equipment synergies.


Western Areas will also now commence the formal process of registering the transfer of the associated mining and exploration tenements with the Department of Mines and Petroleum.


JORC 2012 Resource Statement


Western Areas has completed a thorough review of the previously reported resources for CNC and can now report these resources under the Company's JORC 2012 Compliance procedures (see attachments). The Company's review was not designed to optimise the resource, as this will be one of the workstreams carried out over the next 12 months.


Nickel Mineralisation is in the form of ultramafic-hosted disseminated and massive sulphides. The Mineral Resource is categorised according to drill hole spacing and geological confidence and has been reported in accordance with the JORC Code (2012). A 1.5% nickel cut off grade was applied to all


deposits except for the large low-grade Mt Goode deposit where a 0.4% nickel cut off grade was applied. All resource estimates are based on 3D block models generated using Ordinary Kriging, after applying geostatistical analysis to domained data sets. Further details pertaining to the Mineral Resources can be found in the associated Table 1 documents provided at the end of this report.


The Resource Table for CNC is as follows:


We ste rn Are a s Cosmos Ore Mine ra l Re source Sta te me nt - Effe ctive da te 1 Octobe r 2015

Deposit

Tonnes

Grade Ni%

Ni Tns

JORC Classification

JORC Code

Mineral Resources


479,914


2.6


12,430


Indicated Mineral Resource


2012

1.Cosmos Area

AM5

26,922

1.9

509

Inferred Mineral Resource

2012

AM6

1,704,548

2.7

45,171

Indicated Mineral Resource

2012

329,443

2.5

8,203

Inferred Mineral Resource

2012

Odysseus

3,884,857

2.2

84,301

Indicated Mineral Resource

2012

169,165

2.1

3,603

Inferred Mineral Resource

2012

Odysseus North - Disseminated

1,631,495

2.8

45,519

Indicated Mineral Resource

2012

1,586,175

2.2

35,054

Inferred Mineral Resource

2012

Odysseus North - Massive 1

48,043

11.6

5,563

Indicated Mineral Resource

2012

TOTAL COSMOS AREA

9,860,562

2.4

240,353


2. Mt Goode Area


13,563,000


0.8


105,791


Measured Mineral Resource


2012

Mt Goode

27,363,000

0.6

158,705

Indicated Mineral Resource

2012

12,009,000

0.5

62,447

Inferred Mineral Resource

2012

TOTAL MT GOODE AREA

52,935,000

0.6

326,944

TOTAL MINERAL RESOURCES

62,795,562

0.9

567,297


-ENDS-


For further details, please contact:

Dan Lougher David Southam

Managing Director - Western Areas Ltd Executive Director - Western Areas Ltd Telephone +61 8 9334 7777 Telephone +61 8 9334 7777

Email: [email protected] Email: [email protected]


Shane Murphy FTI Consulting

Telephone +61 8 9485 8888 / 0420 945 291

Email: [email protected] Or visit: www.westernareas.com.au


COMPETENT PERSON'S STATEMENT:

The information within this report as it relates to mineral resources is based on information compiled by Mr Andre Wulfse and Mr Charles Wilkinson of Western Areas Ltd. Mr Wulfse and Mr Wilkinson are members of AusIMM and are full time employees of the Company. Mr Wulfse and Mr Wilkinson have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.' Mr Wulfse and Mr Wilkinson consent to the inclusion in the report of the matters based on the information in the form and context in which it appears.


FORWARD LOOKING STATEMENT:

This release contains certain forward-looking statements including nickel production targets. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as 'may', 'will', 'expect', 'intend', 'plan', 'estimate', 'anticipate', 'continue', and 'guidance', or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production and expected costs.


Examples of forward looking statements used in this report include: 'Third potential underground mine with the undeveloped Odysseus high grade deposit ' and 'The Odysseus deposit holds some high grade massive sulphide intersections of up to 12% nickel which we will be

looking to expand upon in the future.', and ''.

These forward-looking statements are subject to a variety of risks and uncertainties beyond the Company's ability to control or predict which could cause actual events or results to differ materially from those anticipated in such forward-looking statements.

This announcement does not include reference to all available information on the Company or the Cosmos Nickel Complex and should not be used in isolation as a basis to invest in Western Areas. Any potential investors should refer to Western Area's other public releases and statutory reports and consult their professional advisers before considering investing in the Company.

For Purposes of Clause 3.4 (e) in Canadian instrument 43-101, the Company warrants that Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.


Table 1

Mineral Resource Estimation Odysseus

2012 Edition JORC Code


Section 1 Sampling Techniques and Data


Criteria

JORC Code explanation

Commentary

Sampling techniques

  • Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.

  • The Odysseus deposit is defined by 36 Diamond drill (DD) holes; 33 underground and 3 surface holes. The composite file used in the 2012 Mineral Resource Estimate (MRE) contains 1,990 samples.

  • Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.

  • Sample representivity is assured by an industry standard internal QAQC program and assays were done by an independent commercial laboratory

  • All samples are prepared and assayed by an independent commercial laboratory whose instruments are regularly calibrated

  • Aspects of the determination of mineralisation that are Material to the Public Report. In cases where 'industry standard' work has been done this would be relatively simple (e.g. 'reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay'). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information.

  • Diamond core is marked at 1 m intervals and sample lengths are typically of this length.

  • Sample intervals marked up by geologists based on geology.

  • Sampled mineralisation intervals are sent to a commercial laboratory for crushing and grinding before assaying.

Drilling techniques

  • Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of Diamond tails, face- sampling bit or other type, whether core is oriented and if so, by what method, etc).

  • Diamond drilling is used to inform the Odysseus resources; data is derived from both surface and underground Diamond drilling (NQ size core).

Drill sample recovery

  • Method of recording and assessing core and chip sample recoveries and results assessed.

  • Diamond core recoveries are logged and recorded in the database under a Geotechnical tab

  • Measures taken to maximise sample recovery and ensure representative nature of the samples.

  • Sample recovery is high due to the nature of the mineralisation (sulphides) and the type of drilling

  • Diamond core recoveries are logged and recorded in the database under a Geotechnical tab

  • Whether a relationship exists between sample recovery and grade and whether sample bias may have occurred due to preferential loss/gain of fine/coarse material.

  • The resource is defined by Diamond drilling which has high core recoveries.

Logging

  • Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.

  • All geological logging was carried out to a high standard using well established geology codes in LogChief software.

  • All logging recorded Panasonic Toughbook PC logging.

  • Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.

  • Core is photographed in both dry and wet form and logging is done in detail

  • The total length and percentage of the relevant intersections logged.

  • A total of 1,990 samples with an average length of approximately 1m was used to inform the estimate

Sub-sampling techniques and

  • If core, whether cut or sawn and whether quarter, half or all core taken.

  • Diamond core is sampled as quarter core only; cut by the field crew on site by Diamond saw.


Criteria

JORC Code explanation

Commentary

sample preparation

  • If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry.

  • No non core used

  • For all sample types, the nature, quality and appropriateness of the sample preparation technique.

  • The sample preparation of Diamond core follows industry best practice involving oven drying, coarse crushing and pulverising.

  • Quality control procedures adopted for all sub- sampling stages to maximise representivity of samples.

  • The field crew prepares and inserts the QAQC certified reference materials into the relevant calico bags.

  • OREAS and Geostats standards have been selected based on their grade range and mineralogical properties, with approximately 12 different standards used.

  • Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.

  • The bulk of the resource is defined by Diamond drilling which has high core recoveries.

  • Whether sample sizes are appropriate to the grain size of the material being sampled.

  • All geological logging was carried out to a high standard using well established geology codes in LogChief software.

Quality of assay data and laboratory tests

  • The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.

  • All samples are assayed by an independent certified commercial laboratory. The laboratory used is experienced in the preparation and analysis of nickel sulphide ores.

  • Samples are analysed by ALS Chemex in Perth for Ag, Al, As, Co, Cr, Cu, Fe, Mg, Mn, Ni, Pb, S, Ti, Zn and Zr.

  • Genalysis Laboratory Service (GLY) is the Umpire Laboratory used to check analysis on pulps provided by ALS.

  • The principal analytical method used incorporated a four acid digest with conventional ICP-AES analysis, which also includes gravimetric analysis for determining specific gravity.

  • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.

  • No Geophysical tools or handheld XRF instruments were used to determine any element concentrations that were subsequently used for MRE purposes.

  • Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established.

  • Certified reference materials are included in all batches dispatched at an approximate frequency of 1 per 25 samples, with a minimum of two per batch.

  • Field duplicates are inserted into submissions at an approximate frequency of 1 in 25, with placement determined by Nickel grade and homogeneity. Lab checks, both pulp and crush, are taken alternately by the lab at a frequency of 1 in 25.

  • Accuracy and precision were assessed using industry standard procedures such as control charts and scatter plots.

  • Evaluations of standards are completed on a monthly, quarterly and annual basis using QAQCR.

Verification of sampling and assaying

  • The verification of significant intersections by either independent or alternative company personnel.

  • Geological interpretation using intersections peer viewed by site geologists.

  • The use of twinned holes.

  • No holes were twinned in the recent drilling programs.

  • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.

  • All geological logging was carried out to a high standard using well established geology codes in LogChief software.

  • All other data including assay results are imported via Datashed software.

  • Drillholes, sampling and assay data is stored in a SQL Server database located in a dedicated data center.

  • Discuss any adjustment to assay data.

  • none

Location of data points

  • Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used

  • Downhole surveys completed using gyroscopic instrument on all resource definition and exploration holes. Underground drillhole


Criteria

JORC Code explanation

Commentary

in Mineral Resource estimation.

collar locations verified via survey pickup.

  • Specification of the grid system used.

  • A two point transformation is used to convert the data from AMG84_51 mine grid and vice versa.

  • Mine grid points: easting = 250,000, northing = 6,900,000, elevation = -10,000.

AMG84_51 points: easting = -250,000, northing = -6,900,000, elevation = 10,000.

  • Quality and adequacy of topographic control.

  • The project area is flat and the topo data density is adequate for MRE purposes of an underground deposit

  • Collar positions were picked up by suitably qualified surface and underground surveyors

Data spacing and distribution

  • Data spacing for reporting of Exploration Results.

  • Drillhole spacing ranges from 22 m to 76 m, averaging 50 m.

  • The northern zone from 44,690mN to 44,760mN has a significant gap in data density coupled with intrusives into the mineralised corridor.

  • Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.

  • The available drill data demonstrates sufficient and appropriate continuity for both geology and grade within the Odysseus deposit to support the definition of a Mineral Resource as classified under the JORC Code (2012).

  • Whether sample compositing has been applied.

  • The drillhole samples were composited to a regular downhole length of 1 m using the Straight compositing technique, following statistical analysis of the sample lengths.

Orientation of data in relation to geological structure

  • Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.

  • The disseminated Odysseus mineralisation strikes north-south, dips 45° east and plunges 35° north.

  • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.

  • As exploration of the Odysseus Mineralised Corridor continues, a greater understanding is developing between the orientation of mineralisation and the complex relationship with structure and intrusives.

Sample security

  • The measures taken to ensure sample security.

  • Standard West Australian mining industry sample security measures were observed

Audits or reviews

  • The results of any audits or reviews of sampling techniques and data.

  • Geological interpretation and data validation completed by Resource Department geologists.


Section 2: Reporting of Exploration Results - Odysseus

(Criteria listed in Section 1, also apply to this section.)

Criteria

JORC Code explanation

Commentary

Mineral tenement and land tenure status

  • Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.

  • The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.

  • Cosmos Nickel Complex comprises 26 tenements covering some 9,226Ha. The tenements include mining leases and miscellaneous licenses

  • Western Areas wholly owns 23 tenements, which were acquired from Xstrata Nickel Australasia in October 2015. The remainder of the tenements (3) are subject to a Joint Venture with Alkane Resources NL, where Western Areas has earned 80.6% interest

  • All tenements are in good standing

Exploration done by other parties

  • Acknowledgment and appraisal of exploration by other parties.

  • Not Applicable to the Resource and Reserves statement

Geology

  • Deposit type, geological setting and style of mineralisation.

  • The deposits form part of the Cosmos Nickel Complex, which lies within the Agnew-Wiluna Belt of the central Yilgarn Craton, Western Australia

  • The deposit style is komatiite hosted, disseminated to massive nickel sulphides.

  • The mineralisation typically occurs in association with the basal zone of high MgO cumulate ultramafic rocks.

  • Many of the higher grade ore bodies in the Cosmos Nickel Complex also show varying degrees of remobilisation, and do not occur in a typical mineralisation profile

Drill hole Information

  • A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes:

    • easting and northing of the drill hole collar

    • elevation or RL (Reduced Level - elevation above sea level in metres) of the drill hole collar

    • dip and azimuth of the hole

    • down hole length and interception depth

    • hole length.

  • If the exclusion of this information is justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the report, the Competent Person should clearly explain why this is the case.

  • Not Applicable to the Resource and Reserves statement

Data aggregation methods

  • In reporting Exploration Results, weighting averaging techniques, maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated.

  • Where aggregate intercepts incorporate short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation should be stated and some typical examples of such aggregations should be shown in detail.

  • The assumptions used for any reporting of metal equivalent values should be clearly stated.

  • Not Applicable to the Resource and Reserves statement

Relationship between mineralisation widths and intercept lengths

  • These relationships are particularly important in the reporting of Exploration Results.

  • If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported.

  • If it is not known and only the down hole lengths are reported, there should be a clear

  • Not Applicable to the Resource and Reserves statement


Criteria

JORC Code explanation

Commentary

statement to this effect (e.g. 'down hole length, true width not known').

Diagrams

  • Appropriate maps and sections (with scales) and tabulations of intercepts should be included for any significant discovery being reported These should include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.

  • Included within report

Balanced reporting

  • Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.

  • Not Applicable to the Resource and Reserves statement

Other substantive exploration data

  • Other exploration data, if meaningful and material, should be reported including (but not limited to): geological observations; geophysical survey results; geochemical survey results; bulk samples - size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

  • Not Applicable to the Resource and Reserves statement

Further work

  • The nature and scale of planned further work (eg tests for lateral extensions or depth extensions or large-scale step-out drilling).

  • Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drilling areas, provided this information is not commercially sensitive.

  • Future work may aim to increase the resource and reserves in the vicinity of the known ore bodies

  • No plans are yet finalised


Section 3 Estimation and Reporting of Mineral Resources - Odysseus

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)

Criteria

JORC Code explanation

Commentary

Database integrity

  • Measures taken to ensure that data has not been corrupted by, for example, transcription or keying errors, between its initial collection and its use for Mineral Resource estimation purposes.

  • Database validated by site geologists.

  • All data is entered utilising Maxwell's LogChief software for logging of drillhole data in the field on dedicated laptops.

  • Assay data in the form of csv files from the primary assay laboratory ALS Chemex and the umpire assay laboratory Genalysis received by exploration are imported directly into the database whenever possible.

  • Data validation procedures used.

  • The LogChief software provides the first level of data validation, utilising locked lookup tables for all data fields which have set codes attributed to them.

  • The Datashed database utilises validation lookup tables and trigger scripts to ensure that all numeric, date and code information is correct.

  • All QAQC controls are reviewed after each submission. Notification of failures is immediately sent to Senior Geologist and results within until resolution.

Site visits

  • Comment on any site visits undertaken by the Competent Person and the outcome of those visits.

  • If no site visits have been undertaken indicate why this is the case.

  • The CP visited the site during the due diligence period

Geological interpretation

  • Confidence in (or conversely, the uncertainty of) the geological interpretation of the mineral deposit.

  • Mineralised envelopes were digitised at 10 m sections in Vulcan and polygons were snapped to both underground and surface drillhole intercepts as appropriate. Wireframe triangulations were created from digitised polygons, and subdivided into domains as necessary, while taking into account geology and / or grade distribution. All triangulations were validated and checked to ensure they are closed and not crossing.

  • Six geological and geostatistical mineralised domains were created:

    • High grade (>2.0% Ni)

    • Medium grade (1.5 - 2.0% Ni)

    • Medium-low grade (1.0 - 1.5% Ni)

    • Low grade (0.4 - 1.0% Ni)

    • MG_S (single hit intersections) (1.5 - 2.0% Ni)

    • HG_S (single hit intersections (>2.0% Ni)

  • Four lithological waste domains were also created:

    • FV - Felsic Volcanic

    • FP - Felsic Porphyry

    • GP - Pegmatite

    • UM - non mineralised ultramafic

  • The Odysseus deposit is hosted within an ultramafic unit and consists of disseminated nickel sulphide mineralisation as a high grade core surrounded by medium and low grade shells. Late stage pegmatites sit above, below and also crosscut the modelled ore body, but have little continuity between drillholes.

  • Nature of the data used and of any assumptions made.

  • Mineralised envelopes were digitised at 10 m sections in Vulcan and polygons were snapped to both underground and surface drillhole intercepts as appropriate. Wireframe triangulations were created from digitised polygons, and subdivided into domains as necessary, while taking into account geology and / or grade distribution. All triangulations were validated and checked to ensure they are closed and not crossing.

  • The effect, if any, of alternative interpretations on Mineral Resource estimation.

  • As part of its due diligence WSA undertook a Mineral Resource Review which included volumetric checks of the wireframes from first principles using Implicit techniques - the volumes and global grade checks compared favourably with those that were reported.

  • The use of geology in guiding and controlling Mineral Resource estimation.

  • All of the mineral resource was designed within the modelled massive sulphide domain

  • Faults and intrusive units were used when modeling the mineralized units and also used when classifying the deposit


Criteria

JORC Code explanation

Commentary

  • The factors affecting continuity both of grade and geology.

  • The majority of the Odysseus Deposit remains unaffected by late stage intrusives, with minor intersections of pegmatite having little to no continuity between drill holes. A pegmatite intrusion/fault intersects the deposit between 44,700mN and 44,730mN and another truncates mineralisation at approximately 44,775mN, however the main corridor of mineralisation is not adequately closed off from 44,700mN to 44,775mN.

  • Currently the Odysseus Disseminated Nickel Deposit is poorly defined to the north. Mineralisation of potential economic grades and widths remain open down-plunge.

Dimensions

  • The extent and variability of the Mineral Resource expressed as length (along strike or otherwise), plan width, and depth below surface to the upper and lower limits of the Mineral Resource.

  • Factors affecting geological continuity relate to a pegmatite intrusion/fault which intersects the deposit between 44,700mN and 44,730mN and another which truncates mineralisation at approximately 44,775mN.

Estimation and modelling techniques

  • The nature and appropriateness of the estimation technique(s) applied and key assumptions, including treatment of extreme grade values, domaining, interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation method was chosen include a description of computer software and parameters used.

  • The strike length of the Odysseus deposit is approximately 350m. The largest distance from the top of the mineralisation to the base is approximately 225m. The width of the deposit varies between 0.8 m to 68 m averaging 27 m. Average grade and thickness increases down plunge to the north.

  • The availability of check estimates, previous estimates and/or mine production records and whether the Mineral Resource estimate takes appropriate account of such data.

  • Wireframing of grade and geological domains using underground and surface drilling. Sample data was composited to 1m downhole lengths and flagged on domain codes generated from 3D mineralised wireframes (high, medium, medium-low, low, MG_S and HG_S) and 3D lithological wireframes (FV, FP, GP and UM).

  • Directional variography was performed for the Ni and density data from the combined six mineralised domains using Snowden Supervisor software. FV, FP, GP and UM Variograms were also modelled and used to estimate grades into the waste blocks. Due to the multiple orientations of GP units, an additional search ellipse was generated from geological wireframe orientations.

  • Grade estimation of Ni, As, Co, Fe, MgO, Pb, S, Zn and density using Ordinary Kriging was completed using Vulcan software. The domains have hard boundaries which ensured no grade smearing between domains and correlate well with raw data.

  • Due to missing density data, average values were assigned to the FV, FP, GP and non-estimated UM domains. The method is considered appropriate due to drill hole spacing and the nature of mineralisation.

  • All estimation was completed at the parent cell scale to avoid any potential geostatistical support issues.

  • Top cut investigations were completed and no top cuts were applied during estimation. Low and high grade Ni domains were used instead.

  • The assumptions made regarding recovery of by- products.

  • This 2012 MRE is the sixth resource estimate for the Odysseus Disseminated Nickel Sulphide Deposit.

  • The resource model volumetrics were compared to the Sept 2011 results; a minor negative variance exists through the central area of the model.

  • Estimation of deleterious elements or other non- grade variables of economic significance (e.g. sulphur for acid mine drainage characterisation).

  • No assumptions were made about the recovery of by products in this estimate.

  • In the case of block model interpolation, the block size in relation to the average sample spacing and the search employed.

  • Deleterious elements S, As, Pb, Fe, Zn, Cu, Co and MgO were estimated using Ni variography.

  • Any assumptions behind modelling of selective mining units.

  • A proto model was constructed using parent blocks of 10 mE x 15 mN x 5 mRL and sub-blocked to 1.25m x 2.5m x 1.25m.

  • Drillhole spacing ranges from 22 m to 76 m, averaging 50 m.

  • The size of the search ellipse was based on the Ni variography for each domain. Six search passes were used; 100% of blocks were estimated during the 1st pass Ni estimate for HG, MG and MLG domains, and over 99% for the LG domain. HG_S and MG_S


Criteria

JORC Code explanation

Commentary

domains achieved greater than 88% and 87% respectively during the 1st pass.

  • Any assumptions about correlation between variables.

  • No selective mining units were assumed in the estimate.

  • Description of how the geological interpretation was used to control the resource estimates.

  • There is an assumed correlation between Ni% and density (SG), which has been quantified by a regression calculation and estimated in the block model.

  • Discussion of basis for using or not using grade cutting or capping.

  • Mineralised zones were digitised and polygons were snapped to both underground and surface drilling intercepts. Each wireframe is representative of a grade domain, and used in compositing and estimating to ensure high grades are not smearing into the low grade zones and vice versa.

  • To ensure an accurate estimate, all high grade isolated intersections were placed in separate domains (MG_S,HG_S) to ensure they are still accounted for, but their contribution do not artificially inflate the final resource inventory. For reporting purposes, the MG_S and HG_S material are classified as non-JORC 'Mineral Inventory'.

  • The process of validation, the checking process used, the comparison of model data to drill hole data, and use of reconciliation data if available.

  • Top cut investigations were completed and no top cuts were applied during estimation. Low and high grade Ni domains were used instead.

Moisture

  • Whether the tonnages are estimated on a dry basis or with natural moisture, and the method of determination of the moisture content.

  • Estimation validation techniques included visual comparison of the composites and estimate blocks, graphs of pass number versus % filled, swathe plots of the composite grades vs the grade of the block model, and swathe plots of kriging variance, kriging efficiency and slope of regression.

Cut-off parameters

  • The basis of the adopted cut-off grade(s) or quality parameters applied.

  • Tonnages were estimated on a dry basis.

Mining factors or assumptions

  • Assumptions made regarding possible mining methods, minimum mining dimensions and internal (or, if applicable, external) mining dilution. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential mining methods, but the assumptions made regarding mining methods and parameters when estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the mining assumptions made.

  • The mineral envelope was determined by cut offs: High (>2.0%), Medium (1.5-2.0%), Medium-Low (1.0-1.5%), Low (0.4-1.0%), MG_S (1.5 - 2.0% Ni) and HG_S (>2.0% Ni).

  • The resource is reported above 1.5% Ni cut off grades.

Metallurgical factors or assumptions

  • The basis for assumptions or predictions regarding metallurgical amenability. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an explanation of the basis of the metallurgical assumptions made.

  • No mining factors or assumptions were applied.

Environmental factors or assumptions

  • Assumptions made regarding possible waste and process residue disposal options. It is always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider the potential environmental impacts of the mining and processing operation. While at this stage the determination of potential environmental impacts, particularly for a greenfields project, may not always be well advanced, the status of early consideration of these potential environmental impacts should be reported.

  • No metallurgical factors or assumptions were applied.

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Western Areas NL

PRODUCER
CODE : WSA.AX
ISIN : AU000000WSA9
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Western Areas NL is a nickel and gold producing company based in Australia.

Western Areas NL holds various exploration projects in Australia.

Its main assets in production are FORRESTANIA, FLYING FOX MINE and KOOLYANOBBING in Australia, its main asset in development is SANDSTONE - LORD NELSON in Australia and its main exploration properties are MT FINNERTY NICKEL JV, LAKE KING, MT ALEXANDER, MT JEWELL and SPOTTED QUOLL in Australia and EAST BULL LAKE in Canada.

Western Areas NL is listed in Australia and in Canada. Its market capitalisation is AU$ 1.0 billions as of today (US$ 753.6 millions, € 660.2 millions).

Its stock quote reached its highest recent level on April 15, 2011 at AU$ 6.78, and its lowest recent point on March 27, 2020 at AU$ 1.66.

Western Areas NL has 272 280 000 shares outstanding.

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Corporate Presentations of Western Areas NL
2/17/2014Half Year Results Corporate Presentation
11/21/2013Areas AGM Corporate Presentation
2/21/2013Half Year Results Corporate Presentation
Annual reports of Western Areas NL
Annual Report to shareholders
Annual Report to shareholders
2009 Annual Report
Option Grants of Western Areas NL
2/14/2012Maintains Strong Profits and Declares Dividend
Nominations of Western Areas NL
1/3/2012appoints new Managing Director
Financials of Western Areas NL
2/24/2016Half Year Financial Results Press Release
8/20/2015Areas Full Year Financial Results Presentation
Project news of Western Areas NL
1/28/2014Revised Resource Table - December Quarterly Report
12/6/2013RBR: Drilling to Commence at Caesar Hill JV
12/4/2013Drilling to Commence at Musgrave Tenements
11/22/2013Final Director's Interest Notice
9/6/2013Assays Increase New Morning High Grade Nickel Intersection
8/30/2013High Grade 8% Nickel Intersection at New Morning
7/19/2013Further High Grade Intersections at New Morning
7/1/2013TKL: Musgrave project farm-in by Western Areas
3/27/2013New Morning Exploration Update
3/14/2013Exploration Strategy and Activities Update
2/1/2013GEOPHYSICS CONFIRMS SIGNIFICANT CONDUCTOR AT NEW MORNING
1/24/2013(Forrestania)New High Grade Nickel Discovery at Forrestania
1/24/2013GTE:Encouraging gold results intersected in drilling Mt Gibb
7/18/2012(Forrestania)Announces New High Grade Nickel Sulphide Discovery at Forres...
5/11/2012Production Guidance Update
3/14/2012Completed the Acquisition of Kagara Nickel
10/5/2011(Flying Fox Mine)Major Nickel Intersection Below Flying Fox Mine
Corporate news of Western Areas NL
8/11/2017Advance Notice - Full Year Results Conference Call
8/2/2016Diggers and Dealers Presentation
6/15/2016Final Director's Interest Notice
6/9/2016Western Areas Board Change
4/22/2016Quarterly Activities Report
4/5/2016Western Areas - Security Purchase Plan Booklet
4/5/2016Western Areas - Section 708A Cleansing Statement
3/31/2016Successful Completion of Western Areas Placement
1/28/2016Change in substantial holding
1/27/2016Quarterly Activities Report
1/11/2016Becoming a substantial holder
12/21/2015Western Areas Reduces Standby Bank Facility Fees
12/1/2015Change in substantial holding from NAB
11/25/2015Annual General Meeting - MD Presentation
11/25/2015Chairman's Address to Shareholders
10/26/2015Quarterly Activities Report
10/23/2015Notice of Annual General Meeting/Proxy Form
10/12/2015MOX: Western Gawler Craton Drilling Recommenced
10/12/2015Western Gawler Craton Update
10/7/2015Western Areas Revised FY16 Capital Expenditure Plans
10/1/2015Cosmos Nickel Complex Acquisition Completed
9/29/2015Western Areas to Commence Drilling at Fowlers Bay Nickel JV
9/28/2015STA: Western Areas to Commence Drilling at Fowlers Bay Nick
9/28/2015Prospective Mafic Intrusions Confirmed at Western Gawler
9/22/2015Becoming a substantial holder
9/14/2015Change in substantial holding
9/1/2015Change in substantial holding
8/28/2015Change of Director's Interest Notice x 3
8/20/2015Western Areas Report Increased Full Year Profit and Dividend
8/20/2015Appendix 4E & Full Year Statutory Accounts
8/20/2015Western Areas Full Year Financial Results Presentation
8/20/2015Dividend/Distribution - WSA
8/18/2015Full Year Results Conference Call Details
7/30/2015Change in substantial holding from NAB
7/21/2015Quarterly Activities Report - Revised
7/19/2015GNG: Contract Award
7/19/2015MILL ENHANCEMENT PROJECT
7/5/2015Major Drilling Program Commenced at Western Gawler Project
7/2/2015WESTERN AREAS NOW DEBT FREE
6/18/2015Western Areas to Acquire the Cosmos Nickel Complex
4/1/2015Change in substantial holding
3/25/2015Change in substantial holding from NAB
3/11/2015Change in substantial holding from NAB
3/5/2015Ceasing to be a substantial holder
2/18/2015Change in substantial holding from NAB
2/17/2015Becoming a substantial holder from MS
2/16/2015Becoming a substantial holder from CBA
2/12/2015Half Year Results Conference Call Details
2/12/2015Ceasing to be a substantial holder from MS
1/21/2015Western Gawler Craton Project Update
11/6/2014Western Areas to Commence Major Exploration at Fowlers Bay
2/28/2014On Market 2014 Convertible Bond Purchase
2/25/2014Areas Share Purchase Plan Offer Document
2/24/2014Cleansing Statement - Notification under section 708A(5)(e)
2/18/2014Successful Completion of Western Areas Raising
2/18/2014Areas Ltd Capital Raising and SPP
2/17/2014Half Year Results Press Release
2/10/2014Areas Upgrades Full Year Guidance
1/28/2014Competent Person Statement
1/9/2014Becoming a substantial holder
12/17/2013Ceasing to be a substantial holder
12/17/2013Managing Director Interview by Market Professional
12/4/2013TKL:Western Areas proceeds to Stage 2 of JV and begins drill
11/21/2013Areas 2013 AGM Results
11/21/2013WSA 2013 AGM Chairman Address
11/21/2013Areas Chairman to Step Down
11/13/2013Finland Exploration Assets - London AIM Listing
10/21/2013Notice of Annual General Meeting/Proxy Form
10/15/2013TKL: Musgraves project - new targets on WSA JV tenements
9/24/2013Becoming a substantial holder
9/12/2013(Spotted Quoll)Spotted Quoll North High Grade Mineral Resource and Reserve
9/6/2013Substantial Shareholder - Restatement from CBA
8/27/2013Preliminary Final Report and Full Year Financial Statements
8/27/2013Areas Full Year Results Press Release
8/27/2013Areas Full Year Result Presentation Pack
8/21/2013Conference Call: Full Year Results for the Year Ended 30 Jun...
7/31/2013Announces Anticipated Non-Cash Impairment
7/23/2013Quarterly Activities Report
7/4/2013Areas Exceeds Full Year Guidance
7/1/2013Strategic Agreement with Traka at Musgraves
6/24/2013GTE: Rights Issue Entitlement
5/31/2013Areas Upgrades Full Year Guidance
4/23/2013Quarterly Activities Report
4/5/2013Chairmans Letter to Shareholders
4/4/2013Becoming a substantial holder
2/21/2013Half Year Accounts and Appendix 4D
2/21/2013Half Year Results Press Release
2/21/2013Results of Meeting
1/29/2013New Offtake Agreement
1/18/2013Notice of General Meeting/Proxy Form
1/14/2013WSA Announces Successful Completion of Share Purchase Plan
1/14/2013Areas Announces New Constitution
1/14/2013Areas Announces Change of Name and Company Type
12/10/2012Section 708A - Cleansing Notice
10/22/2012Notice of Annual General Meeting/Proxy Form
10/16/2012Takes Top Honours at WA Industry & Export Awards
9/21/2012Weekly Summary Alert
8/15/2012Conference Call-Full Year Results for the Year Ended 30 June...
7/25/2012Announces June 2012 Quarterly Activities Report
7/13/2012Weekly Summary Alert
7/2/2012Retires Convertible Bond From Cash Reserves
6/29/2012Weekly Summary Alert
6/15/2012Weekly Summary Alert
6/7/2012(Spotted Quoll)Spotted Quoll Underground Ore Reserves Increase by 94%
6/1/2012Weekly Summary Alert
5/18/2012Weekly Summary Alert
5/4/2012Weekly Summary Alert
4/20/2012Weekly Summary Alert
4/6/2012Weekly Summary Alert
3/23/2012Weekly Summary Alert
3/9/2012Weekly Summary Alert
3/5/2012Acquires 100% of Lounge Lizard and Kagara's Nickel Assets
2/24/2012Weekly Summary Alert
2/10/2012Weekly Summary Alert
1/27/2012Weekly Summary Alert
1/23/2012Announces December 2011 Quarterly Activities Report
1/13/2012Weekly Summary Alert
12/30/2011Weekly Summary Alert
12/22/2011Closes Out Royalty Obligation To Outokumpu
12/16/2011Weekly Summary Alert
12/2/2011Weekly Summary Alert
11/30/2011Agrees One Year Offtake Contract with Jinchuan
10/12/2011Clarification: Lounge Lizard Nickel Deposit
9/23/2011Weekly Summary Alert
9/8/2011Announces Update on Nickel Concentrate Tender Process
8/26/2011Weekly Summary Alert
8/22/2011Strong Financial Results for Year Ended 30 June 2011 & Full ...
8/12/2011Weekly Summary Alert
8/2/2011Considering Nickel Offtake Tender
5/6/2011Weekly Summary Alert
4/15/2011Announces March 2011 Quarterly Activities Report
4/8/2011Weekly Summary Alert
3/25/2011Weekly Summary Alert
2/25/2011Weekly Summary Alert
2/14/2011ALERT: New Western Areas Financial Report
2/11/2011Weekly Summary Alert
11/7/2008Weekly Summary Alert
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AUSTRALIA (WSA.AX)TORONTO (WSA.TO)
3.84-0.13%4.00+0.00%
AUSTRALIA
AU$ 3.84
05/24 13:05 -
-0.13%
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3.84 3.83
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3.83 3.84
Year l/h YTD var.
3.33 -  3.86 11.95%
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2.24 -  3.86 66.96%
Volume 1 month var.
135,785 -0.260%
24hGold TrendPower© : -33
Produces Nickel
Develops Gold
Explores for Cobalt - Copper - Gold - Nickel - Palladium - Platinum - Rhodium - Silver
 
 
 
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