Mustang Initiates Feasibility Study at Maskwa Nickel


An existing open-pit on Mustang Minerals’ Maskwa property in Manitoba, Canada, will be drained prior to
mining of the current project. (Photo courtesy of Mustang Minerals)
Mustang Minerals reported on June 26, 2008 that it had received a positive, NI 43-101 compliant prefeasibility study from Micon International for its Maskwa nickel project 140 km northeast of Winnipeg, Manitoba, and that it had begun a full feasibility study and permitting activity. The study concluded that “the Maskwa project contains an economic mineral reserve and warrants continued development to the full feasibility stage.” Micon supervised completion the study, which included participation by Met-Chem Canada, Wardrop Engineering and Golder Associates.

The Maskwa prefeasibility study proposes a 2,750-mt/d open-pit mine and mill, producing an average of 9.2 million payable lb/y of nickel in concentrates that will include platinum group metals, copper and cobalt byproduct credits. The previously mined open-pit on the property will be dewatered ahead of mining. Standard grinding and flotation techniques will be utilized to produce the concentrate. The project has access to low hydroelectric power rates and established infrastructure. Initial capital to develop the project is estimated at $123 million.

Mustang President Robin Dunbar, said, “The prefeasibility study indicates that the planned operation at Maskwa has the potential to be a profitable, low-cost producer of nickel and other by-product metals. Using the assumptions outlined in the prefeasibility study, the project will have an attractive nickel cash cost, net of credits, of C$2.77/lb over its life. We are moving ahead on all fronts to complete feasibility level studies and permitting required for the project.”

Economic assumptions for the Maskwa project include nickel prices of $10/lb for the first two years of production and $8/lb thereafter. The prefeasibility study projects an undiscounted, pre-tax operating profit of C$285 million across the life of the mine, with single peak year earnings of C$63 million.

Metallurgical testing to support the feasibility study is currently in progress. A new resource estimate incorporating additional assay data is planned for the fall of 2008. Baseline environmental studies are nearing completion.

A Falconbridge subsidiary, Maskwa Nickel Chrome Mines, discovered the Dumbarton nickel deposit on the Maskwa property during a 1952-1957 drilling campaign. From 1969 to 1974, the company mined 1.7 million mt of ore from the deposit at grades of 0.81% nickel and 0.31% copper, plus unspecified cobalt, platinum, and palladium credits. A second deposit was discovered and mined from 1974 to 1976, producing 365,700 mt, grading 1.16% nickel and 0.2% copper.

Mustang acquired the property in June 2004.

As featured in Womp 08 Vol 6 - www.womp-int.com