Changes to the mine plan and schedule since the February 2017 FS have focused on smoothing the development and mining rates to achieve more effective equipment utilisation, better management of ventilation requirements, and to deliver more consistent ore tonnages and higher grades to the mill, resulting in the following amendments:

  • Ore mining rates average 65,000 tonnes per month for the first 12 months, thereafter averaging 78,000tpm;
  • The vertical pillar in the upper portion of Savannah North, which had been included in the July 2017 Optimisation, is no longer required; and
  • Removal from the mine plan of lower grade stopes (0.8 – 1.0% Ni) on the western side of the Upper Zone. This results in approximately 750,000t of material grading 0.9% Ni being removed from the mine plan. It is important to note that this material is not sterilised and remains accessible for mining at higher nickel prices.

Access development from Savannah to Savannah North is scheduled to commence concurrently with the resumption of production from Savannah.  Access development to first ore at Savannah North is approximately nine months, first Savannah North stopes are in production 11 months after commencement of access development and full production from Savannah North is reached 15 months after commencement of access development (unchanged from the February 2017 FS).

Detailed modelling of ventilation requirements by the Company’s ventilation consultant identified potential constraints with the proposed ventilation design adopted in the February 2017 FS.  The Company has retained the ventilation design used in the February 2017 FS (the key component being a 5m raise-bored fresh air rise to the 1570 Drill Drive at Savannah North), but increased the capacity of the primary fan on the second Savannah return air rise by using the primary fan to be relocated from the Company’s Lanfranchi operation.  Raise boring of the Savannah North fresh air rise is scheduled to take 15 months, which will initially limit production capacity until established.  The revised mining and development rates are within the limits of the proposed ventilation design and development timeframe.

A vertical pillar, which had been included in the July 2017 Optimisation, was identified by Panoramic’s geotechnical consultant as a potential source of seismicity/deformation.  The mine design adopted for the Updated FS excludes the vertical pillar and is otherwise essentially unchanged from the February 2017 FS, which had previously been assessed by the Company’s geotechnical consultant.

Other mining productivity assumptions, including equipment selection, jumbo development rates, load and haul rates, stope designs, and paste fill and curing times are largely unchanged from the February 2017 FS.

The above changes to the mine plan result in a shorter mine life of approximately 8.3 years compared to the February 2017 FS, but with an increased average ore mining rate once at full production of 0.94Mtpa (February 2017 FS LOM average 0.82Mtpa).

The updated mine plan has a mining production target of 7.65Mt @ 1.42% Ni, 0.68% Cu and 0.10% Co, containing 108,700t Ni, 51,700t Cu and 7,300t Co.  Total ore tonnes mined and development rates are shown in Figure 1.

The optimised mining plan includes approximately 1.1% of contained nickel derived from material classified as Inferred Resource (Table 4).  The maximum annual contribution of contained nickel derived from Inferred Resources is 2.4%, in Year 5 (Figure 2).

Cautionary Statement

There is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Indicated Mineral Resources or that the production target itself will be realised.

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