Sirius managing director Mark Bennett and chief operating officer Rob Dennis. Picture: Gerald Moscarda/The West Australian.
Sirius managing director Mark Bennett and chief operating officer Rob Dennis. Picture: Gerald Moscarda/The West Australian.

Sirius Resources has injected hope into the embattled Goldfields mining community of a jobs boost from next year after declaring yesterday its $473 million Nova project on the Nullarbor was financially robust and should deliver one of the world's lowest-cost nickel operations.

Sirius wants to start construction early next year and chief operating officer Rob Dennis said Nova's development and then operating phase would coincide with a sweet spot because of the dearth of new mine activity elsewhere in WA.

"It will work in our favour, from a contractors and supply of labour point of view," he said. "We are fortunate with the timing."

Although Nova's location, east north-east of Norseman, means the workforce will be fly-in, fly- out, Mr Dennis said there was hope labour would come from the Kalgoorlie-Boulder and Esperance centres.

Sirius also said interest from bankers keen to provide debt for Nova's development was strong, despite the broader negative sentiment hanging over the sector.

Sirius managing director Mark Bennett said a major equity raising was likely to complement Nova's debt finance to ensure the project remained as unencumbered as possible, including without metal hedges.

He would not discuss the likely size of the equity raising. But analysts will be expecting the $1.2 billion Sirius to issue between $100 million and $150 million of new shares between now and early next year, when Nova's construction should kick off.

Shares in Sirius, which counts millionaire prospector Mark Creasy (34.9 per cent) as its biggest stakeholder, fell 15¢ to $3.53.

Sirius yesterday released the highlights of Nova's definitive feasibility study, which flagged a 10-year mine life that could produce nickel at $1.66 ($US1.50) a pound when including copper credits for all-in sustaining cash costs of $2.32/lb.

It based its study results on a nickel price of $US10/lb and an exchange rate of US90¢, which compares with nickel's price last night of about $US8.80/lb and a dollar worth about US94¢.

Release of the definitive feasibility study highlights came almost two years to the day since Sirius discovered Nova, one of the best mineral discoveries in Australia in the past decade.

Subsequent drilling and the discovery of the nearby Bollinger deposit have delivered a maiden probable ore reserve of 13.1 million tonnes grading 2.1 per cent nickel, 0.9 per cent copper and 0.07 per cent cobalt, for 273,000t nickel, 112,000t copper and 9000t cobalt.

The West Australian

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