Independence Group’s Nova nickel-copper asset has broken records as production hit 8,375 tonnes of nickel and 3,731 tonnes of copper.
The project also reached a new cash cost record by hitting AU$1.50 per pound of nickel. Nova’s performance helped boost total quarterly revenue for IGO to AU$232.8 million, a 23 percent quarter-on-quarter increase from the prior quarter’s revenue of AU$189 million.
The boost in revenue was underpinned by a 52 percent revenue increase from Nova alone, which was driven by respective 18 percent and 59 percent increases in nickel and copper sales.
“A new record quarterly production from Nova, primarily the result of expected higher mined grades, had the effect of delivering record low cash costs — firmly placing Nova as one of the world’s lowest cost nickel operations,” IGO Managing Director and CEO Peter Bradford said in a statement.
“This, combined with higher realized nickel prices, generated substantial cash flow for the business and positions IGO to pursue our strategy focused on metals critical for clean energy, both through exploration and by progressing our downstream processing study.”
IGO’s Tropicana gold joint venture — which partner AngloGold Ashanti (ASX:AGG,OTC Pink:AULGF) holds a 70 percent stake in — saw a 13 percent decrease in revenue over the quarter to AU$66.2 million, which the company says primarily stemmed from an expected sales drop of 17 percent. The asset produced 123,236 ounces of gold, and, alongside Nova, remains on track to meet full-year guidance.
In April, IGO announced the development of a new process to produce nickel sulfate from nickel sulfide concentrate as part of its downstream nickel sulfate prefeasibility study. The reason behind the study is to secure a commercially viable process for converting nickel-cobalt sulfide from Nova to nickel sulfate.
In Tuesday’s (April 30) quarterly update, IGO said metallurgical test work is progressing well, but “significant” optimization opportunities remain; the company expects the study to be completed during the December 2019 quarter.
As of Tuesday, nickel was trading at US$12,355 per tonne on the London Metal Exchange. Meanwhile, copper was trading at US$6,441 per tonne.
IGO’s share price grew 2.69 percent on the ASX on Wednesday (May 1), ending the day at AU$4.58.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.