Atlantic Nickel sells first nickel concentrate from Santa Rita

Santa Rita — one of the largest open-pit nickel sulphide mines in the world — has sold its first nickel concentrate since being placed on care and maintenance in 2015.

Mirabela Nickel operated the mine for six years before shutting it down due to low nickel prices and high costs.

Today, the asset is owned by private equity firm Appian Capital’s Atlantic Nickel, which has refurbished and restarted the operation, and produced 11,000 dry metric tonnes since blasting resumed in July 2019.

The company recently signed a three-year offtake contract with Trafigura for part of Santa Rita’s production, along with a US$40.8-million financing arrangement with the metal trader.

“The key thing now is to really work hard on the ramp-up,” Paulo Castellari, CEO of Atlantic Nickel and Appian Brazil, tells The Northern Miner.

The plant is expected to produce between 13,000 and 15,000 tonnes nickel equivalent before the end of 2020.

Atlantic Nickel’s Santa Rita project in Brazil. Credit: Atlantic Nickel.

“In the first quarter, we want to be between 40% and 60% of nominal capacity. In the second quarter, between 50% and 70%, and in the third quarter, between 70% and 90% — and then at nominal capacity by the fourth quarter,” he outlines.

Castellari admits Atlantic Nickel is “privileged to have the asset and product we have,” noting that as a brownfield project, it had more than US$1 billion invested in plant infrastructure when it took over the project.

Its mix of nickel and copper is also attractive, he says. “There aren’t that many projects out there that will produce what we will produce,” he says. “It’s an easy product. It will end up one way or the other in the stainless steel market, but the real deal for this asset, now and going forward, will have to be in the battery market.”

The mining executive noted that Atlantic Nickel accelerated the restart by two months due to employing risk analysis and “mapping out the pinch points” along the value chain. He also pointed out that the company had kept contact with the operators who worked at Santa Rita during its Mirabela years, and was able to contact them quickly and get them back.

Santa Rita’s open-pit measured and indicated resources stand at 59.17 million tonnes grading 0.33% nickel sulphide and 0.11% copper.

But the company has also drilled beneath the open pit, and assays so far confirm the continuation of sulphide disseminated mineralization at depth. The company is examining the potential for an underground operation.

“We have delineated reserves that will be enough for some nine years with the current open pit,” Castellari says. “And we are doing studies that will be finalized by the end of the first quarter that firm up the resource that will take the mine beyond these nine years, very probably with an underground component, but also with satellite pits.

“We are very confident that this asset will have a life in excess of 20 years, so the deposit is not only good, but scalable, and this is the right product,” he continues.

In parallel to its arrangement with Trafigura, the company is working with smelters in Europe and Asia.

Castellari notes that the company is fortunate that Santa Rita is in Brazil’s Bahia state — “a very business friendly and mining friendly jurisdiction.”