Lunnon (ASX:LM8) upgrades high-grade deposit key to Kambalda nickel restart

Lunnon Metals has raised the tonnage and contained metal of Foster South by 10 per cent and confirmed the deposit as a key high-grade component for a potential restart from the Foster-Baker deposits within its greater Kambalda project in Western Australia.

The high-grade unmined deposit now stands at 375,000 tonnes at 4.7% nickel for 17,600 contained tonnes, sitting around 300 metres south of the end of the decline at the historically productive Foster deposit.

Lunnon has also been signed off for an underground mining proposal at the starring Baker deposit and its initial probable ore reserve for 17.5 thousand tonnes of contained nickel.

Managing Director Edmund Ainscough said the high grade at its second-best nickel deposit led to the expectations of a high rate of conversion from the indicated category for a future mine plan.

“Just a few hundred metres off the south end of the Foster decline, these 17,600 tonnes of nickel metal were left unmined by WMC at the end of Foster’s operational life and represent a high-priority target, not just for our current PFS work, but also once a future re-start at Foster is underway” Ainscough said.

He added it was also excellent to report approval of the Baker proposal and the newfound ability to restart operations when nickel markets are more conducive.

“Continuing to de-risk our nickel portfolio now, by completing the Baker-Foster PFS and permitting Foster, are low-cost initiatives that save time and add huge value,” Ainscough said.

“In parallel, the team can seek to complement our high-quality nickel portfolio, by adding more value to our gold portfolio, after excellent early success, particularly at Plentiful and Lady Herial.”

The Perth-based explorer has discovered close to 72 thousand tonnes of contained nickel metal since its mid-2021 listing, and now has over four million tonnes at 2.7% nickel to play with across greater Kambalda.

And while the nickel price has been deflated through a glut of low-grade Indonesian output, the sky-high price of gold will offer more exploration opportunities as Lunnon ponders the timing for a restart.

Kambalda is well known for its multi-commodity endowment, and Lunnon sees more golden opportunities arising at Foster after confirming the tenor of high-grade historic drilling.

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