Chalice Mining (ASX: CHN) has delivered a game-changing metallurgical breakthrough at its Gonneville PGE-Ni-Cu-Co Project, simplifying processing, reducing costs, and significantly improving project economics. The latest testwork results confirm that two high-quality, saleable flotation concentrates can be produced from low-grade material, eliminating the need for a costly and complex hydrometallurgical process.
CEO Alex Dorsch described this as a “step change” for the project:
“This breakthrough fundamentally simplifies the world-class Gonneville Project. Removing the need for a hydrometallurgical process materially reduces both capital and operating costs, while also lowering technical risk and streamlining development.”
The Breakthrough: Saleable Copper and Nickel Concentrates
Testwork has demonstrated that smelter-grade flotation concentrates can be produced across the entire Gonneville sulphide Resource, including from lower-grade material:
- Copper-PGE-Au concentrate: 22-26% Cu, 45-60 g/t 3E (Palladium, Platinum, Gold)
- Nickel-Co-PGE concentrate: 7.5-8.7% Ni, 0.8% Co, 18-20 g/t 3E
In addition, further testwork has optimised conventional CIL leaching, recovering additional palladium and gold from flotation tails while significantly reducing reagent consumption and costs.
This simplified processing route is expected to have a major impact on project economics, improving margins for a bulk open-pit mine plan compared to the 2023 Scoping Study. Chalice is now targeting completion of its Pre-Feasibility Study (PFS) by mid-2025.
Lower Costs, Less Risk, Bigger Margins
By removing hydrometallurgy from the flowsheet, Chalice has substantially reduced technical complexity and execution risk, making Gonneville a more attractive and scalable project. The impact on capital and operating costs is expected to be significant, boosting profitability across both high-grade and low-grade mining phases.
Another key advantage? The CIL leaching process is expected to qualify for the newly legislated Critical Minerals Production Tax Incentive, meaning a 10% tax offset on operating costs.
Next Steps: PFS Progress and Strategic Partnerships
Chalice remains in a strong financial position with A$90 million in cash and listed investments (as of December 2024), providing ample runway to finalise the PFS and move towards development. The company is also working with Mitsubishi Corporation under a non-binding strategic MOU, exploring optimal marketing and offtake solutions for future Gonneville products.
With this major metallurgical breakthrough, Gonneville is shaping up as one of the most exciting new critical minerals projects in Australia. Investors and analysts can expect further updates as testwork continues through Q1 2025, leading up to the completion of the PFS by mid-year.
