Phelps Dodge makes nickel-cobalt discovery in Madagascar

In its first foray into the nickel business, Phelps Dodge (PD-N) has discovered a potentially significant nickel laterite deposit in central Madagascar.

Over the last two years, the Phoenix-based copper producer has completed more than 300 holes over 20,000 metres on the 260-sq.-km Ambatovy property, 80 km east of the capital city of Antananarivo.

The company defined four discrete deposits containing a total of 52 million tonnes grading 1.24% nickel and 0.09% cobalt, using a cutoff grade of 0.8% nickel. Historic data from the 1970s indicates that the deposits lie within an overall resource of 168 million tonnes grading 1.1% nickel and 0.1% cobalt.

Ambatovy, like all nickel-bearing laterites, is the product of intense weathering and soil development over ultramafic rocks.

Phelps Dodge has commenced a detailed feasibility study and environmental assessment on Ambatovy, which should be completed early this year. The company also commissioned Hazen Research to conduct metallurgical studies to investigate the use of sulphuric acid to extract the metals.

The magnesium content of the lateritic material at Ambatovy is rather low, at 0.8%. As a result, relatively little sulphuric acid will be required to neutralize the magnesium.

While ammonia is used to treat ores from a number of higher-magnesium laterite deposits, the use of sulphuric acid is a proven technique that has been employed at the Moa Bay nickel deposit in Cuba for the last 30 years.

The Ambatovy project represents Phelps Dodge’s first crack at nickel and cobalt mining, and the company hopes to incorporate technologies learned from the copper business when working with these new metals, says spokeswoman Lynn Adams.

Nickel is one of four metals on which Phelps Dodge is now focusing its exploration activity, she adds. The others are copper, gold and zinc.