Minister opens new nickel processing plant for Western Areas

Mines and Petroleum Minister Norman Moore today officially opened Western Areas' Forrestania nickel concentrator about 150km south-east of Southern Cross.

Mr Moore said the project was an example of the strength of Western Australia's resource sector despite the recent challenges posed by the global economic crisis.

"The nickel industry plays an important role in the State's economy and is expected to continue to do so in coming years," the Minister said.

"Last year, nickel was WA's third biggest resources export earner, with $5.3billion in nickel sales.

"Infrastructure like this, WA's newest nickel processing plant demonstrates confidence in the future of the State's resources sector.

"Long term investment in WA's resources sector will continue thanks to the world-class nature of our mineral deposits, best practice operations and a supportive Liberal-National Government.

"The State Government expects its nickel industry will continue to provide a major benefit to WA, despite the headwinds of the current economic climate."

The Forrestania Nickel Concentrator was built to treat high grade nickel ore (greater than four per cent nickel) from the Flying Fox underground mine, processing this ore to high grade concentrate (approximately 14 per cent nickel).

This process would allow Western Areas to capture the maximum possible value from their nickel mines at Forrestania.

Western Areas was seeking to expand its nickel production at Forrestania to between 20,000 to 25,000 tonnes of nickel per annum by 2010.

Expansion would come from the Flying Fox underground mine and commencement of mining at the Spotted Quoll open pit and proposed underground mine, subject to necessary Government approvals. 

The Forrestania Nickel Concentrator would operate at a processing capacity of 300,000 tonnes of ore per year.

Western Areas was already considering expansion of the plant, which had been built to accommodate increased production from other planned mines.

The company was developing two of the world's highest grade and lowest cost nickel mines (Flying Fox and Spotted Quoll) and has completed initial surface development for two additional planned underground mines (Cosmic Boy and Diggers South) at the 100 per cent-owned Forrestania Nickel Project.

The company had also recently announced an agreement to sell 10,000 tonnes of nickel per year from the Forrestania Nickel Project to BHP Billiton, over a long term sales contract.

"The State Government is supporting the resources industry through a range of measures," Mr Moore said.

"The Department of Mines and Petroleum's priority is to improve the approvals process for the resources sector in concert with a whole-of-government approach."