Cashed-up Panoramic to restart nickel production

Panoramic Resources (ASX:PAN) is poised to rejoin the ranks of nickel producers after securing the funding it needs to restart the Savannah nickel-copper mine in WA’s East Kimberley region.

This comes after the company met all conditions relating to a US$45m secured loan financing facility with Trafigura. First drawdown of the facility is expected to occur in the September 2021 quarter.

This is timely given the metal is currently trading at about $US18,082 per tonne, or $US8.20 per pound — well above last year’s average of about $US6.26/lb.

“Our multi-faceted arrangement, including the US$45M finance facility and a five-year nickel and copper concentrate offtake agreement from February 2023, is structured with repayment terms which support the Savannah commissioning, ramp up period and long-term production,” managing director Victor Rajasooriar said.

Savannah is expected to mine and treat 10.6 million tonnes of ore grading 1.23% nickel, 0.54% copper and 0.08% cobalt.

All-in-sustaining costs are expected to be about $6.23/lb of nickel including byproduct credits to generate pre-tax cashflow of $820m.

Panoramic is currently expecting to start mining in August, begin process plant commissioning in November and ship concentrate before the end of 2021.

Panoramic Resources (ASX:PAN) share price chart

Nickel news on the way

Poseidon Nickel (ASX:POS) has gone into a trading halt pending a response to an ASX speeding ticket and the release of assay results from drilling at its Golden Swan project near Kalgoorlie.

It doesn’t take a rocket scientist to figure that the two may well be related, which makes for some interesting questions.

Golden Swan was first discovered in March 2020 after the first two holes hit high-grade massive nickel sulphides of 23.1m at 4% nickel and 0.4% copper including 7.6m at 8.8% nickel and 9m at 10.46% nickel including 4.6m at 13.8% nickel.

Since then, drilling has confirmed the continuity of high-grade mineralisation at the discovery, which remains open in both plunge directions.