FPX amends PEA for B.C. nickel project
FPX Nickel Corp. [TSXV-FPX; FPOCF-OTC] said Wednesday March 17 that it has filed an amended preliminary economic assessment (PEA) technical report for the Baptiste Project at its wholly-owned Decar nickel district in central British Columbia.
The company said the amendment has not impacted the material components of the PEA, notably resources, metallurgy, mine plan, cost estimates, economic analysis and environmental matters.
However, it said the technical report dated September 9, 2020 has been adjusted to amend the certificates of certain qualified persons who contributed to the technical report and include customary cautionary statements regarding the economic analysis included in the technical report. It will amend language regarding site visits by qualified persons and their reliance on other experts and remove certain cut-off scenarios from tables providing sensitivity to various cut-off grades in the technical report.
FPX Nickel shares advanced on the news, rising 1.4% or $0.01 to 73cents. The shares are currently trading in a 52-week range of 94 cents and 11 cents.
The Decar Nickel District is a greenfield discovery of nickel mineralization in the form of a naturally-occurring nickel-iron alloy called awaruite. Covering 245 km2, it represents a promising target for bulk tonnage, open pit mining, the company has said.
Baptiste is one of four targets in the Decar Nickel District and has been the main focus of diamond drilling since 2010.
At the PEA base case of US$7.75/lb nickel, the Baptiste Project is expected to generate an after-tax net present value (8%) of US$1.7 billion and an after-tax internal rate of return of 18.3%.
According to the PEA, Baptiste contains 1.9 billion tonnes of indicated resources averaging 0.122% DRR nickel or 2.4 million tonnes of nickel. On top of that is an inferred resource of 593 million tonnes of 0.114% DTR nickel, containing 700,000 tonnes of nickel.
“This PEA establishes Baptiste as a premier large-scale nickel project,” FPX Nickel President and CEO Martin Turenne said “The project has the potential to be a significant global nickel operation, with a multi-generational operating life and average annual production of 99 million pounds of contained nickel.”
Baptiste’s enormous scale, combined with low C1 operating costs of US$2.74/lb has the potential to deliver robust operating margins throughout the nickel price cycle, generating average earnings (before royalties, taxes and depreciation) of US$481 million per year and an after-tax NPV of US$1.7 billion.