Helix Resources’s (ASX: HLX) 100% owned subsidiary company Ionick Metals Ltd has executed an Option Agreement with Alchemy Resources Ltd to acquire its 80% joint venture interest in the Ni-Co mineral rights at the West Lynn Nickel Laterite Project in NSW.
West Lynn is an advanced project located ~40km north of Ionick’s mineral rights south of Nyngan in central NSW.
It features a significant Inferred Mineral Resource estimate (MRE) containing 180kt of nickel and 11kt of cobalt and is very similar in nature to Ionick’s Homeville deposit. Finalisation of the West Lynn Ni-Co Option provides sufficient ‘resource momentum’ to present investors with a sound exploration and development strategy to seek external funding for Ionick’s laterite nickel and cobalt assets.
The West Lynn Ni-Co Option covers the Ni-Co rights on Exploration Licences EL8318 and EL8631 which are held in the ‘Ochre Resources’ joint venture between Alchemy (80%) and Develop Global Ltd (ASX: DVP) (20%).
Under the agreement, Ionick has the Option to acquire 80% of the ‘nickel- cobalt minerals’ comprising (nickel (Ni), cobalt (Co), platinum group metals (PGMs), scandium and aluminium) with Develop retaining its existing 20% interest. The Ochre JV retains 100% ownership of all the non-nickel- cobalt minerals.
This Option with Alchemy completes significant local ‘consolidation’ of nickel-cobalt assets in the region and underpins a planned spin out of Ionick Metals from Helix. We appreciate the support of Alchemy to combine these nickel-cobalt assets into what we plan to be a stand-alone vehicle, Ionick Metals, to commercialise them,” Helix’s Chair and Ionick Director, Mike Rosenstreich, said.
“A key objective for Ionick will be to define a large-scale high grade Mineral Resource estimate greater than roughly 80Mt. We think this is a threshold for a ‘meaningful’ scale nickel project in terms of production output and mine life to initiate the appropriate feasibility work.
“Under this option agreement Ionick has almost doubled its resource inventory to around 40Mt3 at an attractive grade of 0.8 to 0.9% nickel depending on the cut-off grade. This sizable bump in resources, plus the addition of numerous high-grade prospects provides Ionick with strong momentum towards achieving its critical resource threshold.
“Ionick’s development strategy, which currently emphasises consolidation and development of high nickel-grade and large-scale tonnage, highlights how alert we are to the challenges faced by other laterite projects which have become stranded in terms of interest and financing.
“We are building on what we consider are key points of difference to be able to progress Ionick into development. Laterite projects offer some unique opportunities to get involved in long-term and large-scale nickel production compared to sulphide nickel projects and it is very exciting to see the Ionick business plan take shape.
“Having completed this vital asset consolidation, we can now start to have serious conversations aimed at recruiting a high-quality Board and executive team with technical and commercial nickel experience to build upon and execute our strategy.”