Poseidon Nickel Ltd (ASX:POS, OTC:PSDNF) has secured independent verification of two near-surface, high-grade nickel exploration targets at the Black Swan Nickel Project, which has been in care and maintenance.
POS engaged Muller Geological Services Consultancy (MGSC) to complete a data integrity audit against the geological interpretations at Black Swan.
The consultancy company used a combination of lithogeochemical correlation and verification of all logged geological units to update the geological felsic footwall 3D model, which was then compared to 2023 Newexco exploration targets and felsic footwall models.
The two reviews independently verified two highly prospective high-grade targets closer to surface at the Cygnet South and Upper Southern Terrace prospects.
Eye to test targets in near term
“We are pleased that exploration reviews at Black Swan by two specialist nickel consultant groups have independently verified two promising near-surface high-grade nickel targets,” Poseidon Nickel CEO Brendan Shalders said.
“Following on from NewExco’s review completed during 2023, the company has further refined these two near-surface exploration targets.
“There is a strong desire to test these targets in the short term as a high-grade discovery can potentially add to reserves for any future Black Swan restart with the potential to decrease the unit costs and further improve the project economics.
“The company plans to undertake low-cost surface drilling programs to test these targets in the near term.”
Before drill testing can begin, POS will complete a data integrity review for the upper Northern Terrace and the remainder of the greater Black Swan project area.
This will include extending the detailed section-based footwall model across the entire project area focusing on near-surface opportunities.
Strong reduction in costs
“The company is pleased to see the strong increase in the nickel price while acknowledging that nickel prices are likely to remain volatile for the foreseeable future,” Shalders said.
“With this in mind, the company has reviewed its care and maintenance at Black Swan and has implemented initiatives to further remove up to $1 million of annualised costs.
“On top of the expenditure reductions already implemented, the company has now reduced total annualised costs by $5.8 million.
“In addition, the company is divesting surplus equipment which is expected to release up to $600,000 cash in the coming months.
“The proposed changes to care and maintenance and the proposed sale of surplus equipment is not expected to impact any future restart plans for the project.
“The estimated 12-month plant refurbishment period assumed in the bankable feasibility study released in November 2022 should provide more than sufficient time to prepare the Silver Swan mine and infrastructure for any future operations.
“There would be additional capital expenditure required to undertake these works, however the cost would unlikely be prohibitive to restarting the project.”
Poseidon has now begun exploration program planning for the Cygnet South and Upper Southern Terrace high-grade targets.