The Conversation (0)
Critical metals explorer Leeuwin Metals Ltd (Leeuwin or the Company) (ASX: LM1) is pleased announce an update on the progress of drilling activities at the Company’s 100% owned William Lake Nickel Project (William Lake) in Manitoba, Canada.
HIGHLIGHTS
- Confirmation of significant nickel sulphide mineralisation in all drill holes solidifies William Lake as a major nickel system within the world-class Thompson nickel belt
- Drilling to date has intersected multiple zones of massive sulphide and disseminated nickel sulphide mineralisation
- Significant intercept from hole WL23-367, at the W56 target:
- 1.4m massive to semi massive sulphide zone with spot pXRF of 5% Ni within 24m zone of disseminated nickeliferous sulphides from 227.2m
- 1.4m massive to semi massive sulphide zone with spot pXRF of 5% Ni within 24m zone of disseminated nickeliferous sulphides from 227.2m
- Drilling is ongoing, with 8 holes completed, totalling ~4,000m; priority assays expected in coming weeks
- Untested geophysical anomalies have been identified through down hole electromagnetic (DHEM) surveys at the high-priority prospects of W21 and W56
- Highly encouraging mineralisation intercepted in all drill holes extending zones beyond the historic nickel sulphide intercepts
- Completion of on-site visit by Glencore technical committee
Managing Director, Christopher Piggott, commented:
“The results from our first drill program confirms that William Lake is a significant nickel system within the world-class Thompson nickel belt. Drilling has intersected nickel sulphides in all holes to date affirming the presence of significant mineralisation.
This successful start to our exploration program has not only confirmed the accuracy of our existing geological model but has also showcased the immense scale of the project. The utilisation of drilling and DHEM techniques has further reinforced the view that our project represents a significant nickel system. Given the desirability of high-grade Class 1 nickel deposits in the context of the green energy transition, Leeuwin is in an ideal position to capitalise on this opportunity at William Lake.
Additionally, we extend our gratitude to the Glencore technical committee personnel for their attendance during the project site visit. Their presence and input are greatly appreciated.
We look forward to updating the market in the coming weeks, as we receive results from our assays.”
Figure 1: W56 prospect - WL23-367 Massive Sulphides at 227.2m and net texture sulphides at 248.5m.
Figure 2: W21 prospect - WL23-370 Stringer Sulphides from 400m including a 30cm zone of semi massive sulphides - left (90% pyrrhotite, 10% pentlandite).
Initial Drilling and DHEM
The Company’s maiden drill program continues to be a success, providing confirmation of the geological model, and identifying extensive areas of pentlandite-rich massive to disseminated sulphides. The drilling has been focused on extending known high-grade nickel mineralisation at the W56 and W21 prospects through +100m step-out drill holes. The results support the interpreted continuity of mineralisation and provides further geological information to enable targeting of higher grade zones. Assays for all holes are currently pending, but we expect results to be available in the coming weeks. See Table 2 of Appendix A for a summary of significant visual intercepts.
Initial DHEM testing at W21 has identified a large conductor measuring 200m x 60m, which coincides with higher grades of nickel mineralisation in historical drilling. We anticipate the results of further surveys are anticipated shortly, providing additional insights into the deposit.
W56 Prospect - Summary of Results
Four holes, totalling ~2,100m of diamond drilling, have been completed at the W56 target, which is a large-scale prospect. Historical data indicates a continuity of high tenor nickel sulphides along a trend of over 2km. Leeuwin’s maiden drill program was specifically designed to target interpreted high-grade shoots. All four holes have intersected nickeliferous sulphides within the target horizon, effectively extending the mineralisation along strike and up-dip from historical intercepts (refer to Appendix B Table 1 for details).
To the northwest of the W56 target, drill hole WL23-367 has intercepted a zone of 1.4m of massive to semi-massive sulphides (50% pyrrhotite, 20% pyrite and 5% pentlandite) at a depth of 227.2m. This sulphide zone is part of a broader 24m interval containing disseminated and net-textured nickeliferous sulphides, from 227.2m (15% pyrrhotite and 1% pentlandite) (refer Figure 1). Portable X- ray Fluorescence (pXRF) spot readings within the semi-massive sulphide zone at 227.5m ranged from 0.9% Ni up to 5% Ni, while concentrations of net to heavy disseminated sulphides within the wider interval exhibited spot pXRF readings ranging from 0.5% Ni up to 3% Ni.
Hole WL23-367 is a 180m up dip extension to high-grade nickel mineralisation intercepted in WL96- 168, where a historical result of 7.83m @ 1.73% Ni from 572m was obtained in the main target horizon (refer to historical results in the Company's Prospectus on the ASX, dated 28/03/2023).
Click here for the full ASX Release
This article includes content from Leeuwin Metals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Nickel Price 2024 Year-End Review
Read on to learn what other key factors moved the nickel sector in 2024.
Nickel price in Q4
Nickel reached its 2024 peak of US$21,615 per metric ton on May 20, but was back below the US$16,000 mark by the end of July. Following some volatility in August and September, it reached US$18,221 on October 2.
However, higher prices were not to last, and nickel spent much of Q4 in a downward trend.
By the end of October, nickel had fallen to US$15,732 before climbing back to US$16,607 on November 7.
Since then, the nickel market's downtrend has largely continued. On December 19, the metal slumped to its 2024 low of US$15,090, ultimately ending the year at US$15,300 on December 31.
Nickel price, Q4 2024.
Chart via Trading Economics.
As mentioned, nickel’s weak price performance is largely due to high output from Indonesia and low demand, particularly from Asian markets, as China’s recovery has failed to gain traction.
Against that backdrop, Indonesia said on December 19 that it was considering cutting mining quotas to boost prices. The move would reduce the amount of nickel ore allowed to be mined almost in half, to 150 million metric tons in 2025.
Additionally, Indonesia is looking to tighten environmental regulation compliance for miners in the new year, which could increase volatility for metals including nickel. The move comes not long after the country signed several new agreements in November with Chinese companies that would see billions invested in Indonesian nickel operations.
Indonesia had previously worked to distance itself from partnerships with China as it sought to improve relations with the US and be included under the country's US Inflation Reduction Act (IRA).
The new agreements emerged shortly after Donald Trump won the US presidential election on November 7. Trump’s return to the Oval Office is unlikely to bode well for Indonesian officials seeking to secure a trade deal with the US. However, a loosening of rules in the IRA might create new inroads for Indonesian nickel producers.
How did nickel perform for the rest of the year?
Nickel price in Q1
The story since the start of the year has been high output from Indonesian operations.
Low prices saw some nickel producers, including major miner First Quantum Minerals (TSX:FM,OTC Pink:FQVLF) and Australia’s Wyloo Metals, cut production. However, New Caledonia was most affected. The country is highly dependent on its nickel sector, with industry giants like Glencore (LSE:GLEN,OTC Pink:GLCNF), Eramet (EPA:ERA) and raw materials trader Trafigura owning significant stakes in nickel producers in the country.
Ultimately, cuts there led to a 200 million euro bailout package from the French government, which exacerbated tensions over New Caledonia's independence from France. Opponents of the agreement argued that it risks the territory's sovereignty, and that mining companies aren’t contributing enough to bail out the mines, which employ thousands.
Nickel price in Q2
The second quarter was defined by a surge in nickel prices.
Positive momentum began to work its way into the market at the end of Q1, as Indonesia experienced delays in approving mining output quotas and speculation grew that Russian nickel could be sanctioned by the US and UK.
On April 12, news broke that Washington and London had banned US and UK metal exchanges from admitting new aluminum, copper and nickel from Russia. Taking immediate effect, the prohibitions also halted the import of those metals, causing prices to soar to a year-to-date high of US$21,615 on May 20.
At the time, Joe Mazumdar, editor of Exploration Insights, suggested this move would have little impact on the sector.
“That nickel is still going to make it into the market, it’s just going to go to a different exchange, probably Shanghai … So I could still see that nickel moving and getting consumed in the global market — it’s just not coming to the west,” he explained to the Investing News Network in an interview.
Ultimately, by the end of the quarter, the price was trending toward US$17,000.
Nickel price in Q3
Nickel saw a strong end to the third quarter, with prices rising above the US$18,000 mark.
Nickel found support in September as the Chinese government introduced a raft of stimulus measures intended to boost economic growth in the country. Among the measures were a 0.5 percent interest rate cut on existing mortgages, and a reduction in the downpayment required to purchase a home to 15 percent from 25 percent.
The announcement came alongside cuts at Chinese smelters as they were forced to deal with a shortage in feeder supply due to more delays to Indonesia’s permitting and quota system.
Investor takeaway
The nickel market is expected to remain oversupplied for some time.
With China’s economy on a slow path to recovery, demand is projected to remain weak. Meanwhile, supply will likely hinge on whether Indonesia chooses to make significant cuts to its output.
While demand for nickel in electric vehicle batteries is expected to be up 27 percent year-on-year in 2024, producers have also been pursuing alternatives that don’t require as much nickel. Additionally, more consumers are looking to plug-in hybrid vehicles with smaller batteries that require less nickel.
Even with the increased demand from the battery sector, nickel is primarily used in stainless steel products, which are still dominated by the Chinese manufacturing and real estate sectors.
Perhaps the most significant factors to consider are political. A new administration in the US and a shift in its approach to sourcing critical metals like nickel could alter the landscape for nickel producers in 2025.
Don’t forget to follow us @INN_Resource for real-time news updates.
Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Accelerated Non-Renounceable Entitlement Offer Results
Under the Entitlement Offer, eligible shareholders were invited to subscribe for one (1) New Share for every four (4) existing Shares held at an offer price of $0.03 per share.
The Company has now closed the retail component of the Entitlement Offer with applications totalling 2,767,788 shares including additional acceptances to be issued at $0.03 on top of the 18,650,023 shares issued under the institutional component of the Entitlement Offer on 15 November 2024. In accordance with the timetable, the New Shares will be issued on or before 4 December 2024.
The retail component of the Entitlement Offer is partially underwritten by Nanjia Capital Limited “(Nanjia”) for the amount of approximately $1.09m. Accordingly, Nanjia will now subscribe for 36,349,900 New Shares in accordance with the underwriting arrangements summarised in section 7.4(b) of the Prospectus and the Company expects to finalise this process within the next week.
Shortfall Share Placement
A total of 74,946,591 New Shares were not taken up under the Entitlement Offer by eligible securityholders or issued to Nanjia as underwriter (“Shortfall Shares’”) The directors will work with the lead manager to the Entitlement Offer and the major shareholders to place the shortfall within three (3) months of the closing date, subject to requirements of the ASX Listing Rules and Corporations Act 20021 (Cth) continuing to be met. Please refer to the Prospectus dated 4 November 2024 for further details on the issue of the shortfall.
Click here for the full ASX Release
This article includes content from Blackstone Minerals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
