Poseidon Nickel (ASX: POS) has commenced an extensive 31,000 metre underground drilling program at Mt Windarra from 400 metres, which is the first underground drilling at the Windarra project for two decades.
Poseidon is developing the first new nickel project in Western Australia for many years, with Windarra a higher grade nickel sulphide deposit - which has already demonstrated high recovery levels through a standard nickel floatation concentrator.
The company has completed its Definitive Feasibility Study with an initial target of concentrate production in 2014. The concentrator plant to be constructed at Mt Windarra is expected to have a minimum throughput capacity of 700,000 tonnes of ore per annum.
High intensity drilling program
The high intensity program of work will continue for several months, with initial drill intersections expected shortly.
Phase 1 drilling is intended to extend the current resource and reserves at C & D Shoots and Phase 2 will explore additional mineralisation intersections under A, B, G & H Shoots.
The drilling has been designed to extend the resource and reserve base at Mt Windarra prior to a final decision to commence mining in 2013.
In total, Poseidon currently has a 144,000 tonne nickel resource which compares well with successful peers at start up.
Highly productive past
Poseidon said that several areas in the mine previously identified as hosting additional ore resources to those already drilled have been identified and will be more extensively tested with the potential for significant expansion of the current resource base.
Mt Windarra has in the past been a highly productive mine, with modern exploration techniques such as down hole electromagnetics are expected to greatly assist the discovery and ore expansion process.
Previous drilling at depth has yielded high grade nickel intersections including DE546 No1 10.00m at 2.68%, EE554 No 4D 14.3m at 4.02%, NMD0001 9.82m at 6.06%, PND0010 5.00m at 1.74% and PND0010C 1.55m at 5.33%.
The importance of these intersections is that they provide confidence in the quality of the ore body. Phase 1 of the drilling program will follow up these results with sufficient intersections to increase the Reserves for the first 2 years of operation.
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