Sirius Signs Offtake Deal with BHP Billiton Nickel West

Sirius Resources NL (ASX:SIR) announced that it has reached an agreement with BHP Billiton Nickel West Pty Ltd. to supply about half of its planned nickel sulfide concentrate production for a three-year period. That period will start when Sirius commences production at its Nova mine, likely in late 2016.

As quoted in the press release:

Sirius will truck concentrate by road from the Nova mine site to Nickel West’s processing facilities at Kambalda.

The commercial terms of the offtake agreement are confidential, but reflect the anticipated exceptionally high quality of the Nova nickel concentrate, which has very low levels of deleterious elements and an extremely high average Fe:MgO ratio of 62. These characteristics are anticipated to make the product very smelter-friendly, because it is the ideal material to blend with other, lower quality concentrates that are otherwise problematic for smelting.

This contract is consistent with the Company’s previously stated aim of splitting its planned nickel concentrate production between two customers.

Mark Bennett, managing director at Sirius, commented:

We are pleased to have secured such an attractive offtake deal for half of our planned nickel production for the first three years of Nova’s initial ten year mine life. We are looking forward to a productive relationship with Nickel West.

Click here to read the full Sirius Resources NL (ASX:SIR) press release.