WITH a strong portfolio of nickel and gold projects plus cash and current receivables of $126.4 million, WA’s Panoramic Resources is well placed for growth in the next 12 to 18 months.
The company’s Savannah and Lanfranchi nickel projects are booming – Panoramic has forecast that it will produce between 17,500t and 18,500t of nickel this year – and its recently acquired Gidgee gold project is showing strong promise.
Savannah nickel project More than 200km south of Kununurra in WA’s East Kimberley region, the Savannah project consists of a nickel sulphide ore body, an underground mine, a processing plant and associated infrastructure.
The Savannah ore body, a sulphide-rich nickel, copper and cobalt formation hosted by the layered mafi c-ultramafi c Savannah Intrusion, is mostly confi ned to a marginal norite unit up to 40m thick, developed at the base of the intrusion. Areas of massive, matrix and disseminated sulphide mineralisation, dominated by pyrrhotite, chalcopyrite, pentlandite and minor pyrite ore, occur throughout the marginal norite unit. Based on the project’s current mining and production schedule, resource inventory, exploration to date and favourable economics, Panoramic has reported that Savannah’s mine life could be extended beyond its original estimate of 2018.
The majority of ore at Savannah is mined via longhole open stoping: a highly mechanised, low-cost mining method. During mining, the top and bottom of the ore block are accessed via tunnels, a slot raise is created and holes are then drilled to blast vertical slabs off the ore block. Once the block has been blasted and extracted, the stopes are fi lled with paste (tailings and cement mix) to stabilise the void and allow extraction of adjoining ore blocks.
The process produces minimal waste, but any excess material is either stockpiled underground or trucked to the surface. The process plant at Savannah utilises a single-stage crusher, SAG mill, and flotation, thickening and filtering stages to produce a bulk nickel-copper-cobalt concentrate. The processing plant was originally designed for throughput of 750,000 tonnes per annum, but it has outperformed its design specifications.
Panoramic reported that its on-site processing staff were confident that the mill could operate up to a capacity of between 900,000 and 950,000tpa if required. Metallurgically, the plant has consistently performed extremely well: both nickel and cobalt recoveries average well above the plant’s design of 78 per cent and 69 per cent respectively, while copper recovery averages more than 95 per cent as per the plant’s design.
The concentrate produced at Savannah averages between 7 per cent and 8 per cent nickel, between 3 per cent and 4 per cent copper, and between 0.4 per cent and 0.8 per cent cobalt. The concentrate is trucked  to Wyndham, 240km north of the mine, to await bulk shipment to China, and shipments are made on a monthly basis. In February 2010, Panoramic decided to proceed with the construction of a purpose-built concentrate  storage shed at Wyndham Port to be managed by Savannah staff. The decision was announced at the conclusion of a two-year study that focussed on optimising the efficiency of the handling and transport of concentrate between Savannah and its customers in China. The design of the shed allows road trains to be completely enclosed inside when unloading concentrate. The shed maintains negative pressure, and stored concentrate is reticulated using a purpose-built sprinkler system. A small fl eet of containers is used to transfer concentrate from the storage shed to the wharf for loading, and the containers are discharged into the vessels by a tipping
jig that was specifi cally designed for the task by CPC Engineering. When the prototype of the jig was being trialled at Wyndham, Panoramic reported that it was proving to be highly successful. “To date, the prototype tipping jig has provided clear improvements to the way concentrates are loaded into vessels at Wyndham by eliminating spillage and reducing the amount of heavy machinery operating in close proximity to personnel,”
the company stated. “The jig has been well accepted by the stevedores at Wyndham and has enabled them to achieve higher loading rates compared to previous methods.” Concentrate from Savannah is contracted for sale to China’s Jinchuan Group until April 2020, and is shipped directly from Wyndham to Jinchuan’s smelter and refi nery in Gansu province in northwest China. The terms of the extended concentrate sales agreement between the two companies are similar to the terms of an original concentrate sales agreement signed in 2003, and Panoramic has described them as “very competitive in global terms”.
The general terms and conditions of the agreement include: the typical specifications of the sulphide concentrate being purchased; the quantity – about 100,000 wet metric tonnes per annum, with no minimum or upper limit; and the price basis, which is calculated on an agreed percentage of the London Metals Exchange cash price for nickel and copper, and an agreed percentage of the Metal Bulletin cobalt price.
Panoramic reported that as part of its 2012 exploration program, it would undertake drill testing on strong electromagnetic (EM) conductors around the Savannah ore body and would specifically drill the strong EM response area known to exist below 900m.
Lanfranchi nickel project Panoramic’s Lanfranchi project comprises the Lanfranchi nickel operations and associated Tramways tenements, which are 42km south of Kambalda in WA. Panoramic acquired a 75 per cent interest in Lanfranchi from BHP Billiton Nickel West (formerly WMC Resources) in June 2004, and in 2009 purchased there maining 25 per cent from its, then joint venture partner Brilliant Mining Corp. High-grade nickel sulphide deposits at Lanfranchi occur as ribbon-like shoots a the base of high-magnesium komatiite lava channels. The shoots and high-magnesium lava flows occupy channel structures developed in the underlying basalt rock.
Above the high-magnesium fl ows is a second, thick sequence of progressively less magnesium-rich komatiite flows. Ten channel structures are recognised at Lanfranchi, of which, six have been mined historically.
The majority of the ore is now mined via longhole open stoping, with the entire mining process very similar to the one practiced at the Savannah project. Run-of-mine ore from Lanfranchi is delivered to BHP Billiton Nickel West’s Kambalda concentrator, about 40km north of Lanfranchi by road, where it is processed for a tolling fee. The current agreement between Panoramic and BHP Billiton Nickel West, regarding ore tolling and concentrate purchase, is in place until February 2019. BHP Billiton Nickel West has a first right of refusal to take additional ore from Lanfranchi above the contracted 350,000tpa level set out in the contract. In January, Panoramic reported the discovery of a new zone of mineralisation at Lanfranchi, the Jury-Metcalfe Zone, down plunge of the project’s existing Skinner ore body.
In a statement, the company said that six drill holes had defined Jury-Metcalfe, returning broad intervals of disseminated and matrix-style nickel sulphide mineralisation. The best results from drilling included 39.5m at 1.79 per cent nickel, 34.18m at 1.93 per cent nickel and 46.72m at 1.84 per cent nickel. Panoramic reported that Jury-Metcalfe remained open both up and down plunge, and was readily accessible.
In the same statement, Panoramic reported that drilling had also intersected mineralisation on the same contact that hosts Lanfranchi’s existing Schmitz ore body.
“In addition to the Jury-Metcalfe intersections, three of the drill holes intersected thin, moderate-grade, semi-massive to massive sulphide nickel mineralisation on the same ultramafi c-footwall basalt contact that hosts the Schmitz ore body further to the east,” the company stated. “Results are as follows: 3.49m at 2.15 per cent nickel; 5.77m at 4.12 per cent nickel; and 1.14m at 5.81 per cent nickel.” Part of Panoramic’s $12.5 million exploration budget for 2012 will go towards further down-plunge drilling at Schmitz, as well as drilling at the Lanfranchi project’ Deacon, Helmut South, Cruikshank and Lanfranchi ore bodies.