Shareholders of Emu Nickel, the West Australian mining company looking to acquire and recommission the Hillgrove’s antimony gold mine, have overwhelmingly voted in favour of the mining company’s new proposal at the general meeting held last Wednesday, April 4.
The majority vote by shareholders clears the way for Emu Nickel to transform from a nickel explorer to antimony gold miner and developer, under a strategy to have Hillgrove back in production by mid next year. Emu Nickel will also change its name to ANCOA.
The Hillgrove mine is one of the largest antimony resources outside of China and was put under maintenance and care by owners Straits Resources in 2009.
Chairman of Emu Nickel, Peter Thomas, is confident of raising the $60 million to fund part payment of the purchase price, to fund the proposed modifications to the existing plant and to cover operating costs until the company gets to cash flow positive from production.
“We expect from the time capital raising is completed, production to ramp up towards the end of  12 months,” said Emu Nickel Chairman Peter Thomas.
“Our goal is to have a steady operation starting from 20 months from the capital raising and a mine life, on current reserves of ten years, at the proposed throughput rate.
“If the resources convert to reserves at the historic 65 percent ratio, we expect there to be at least another six years mine life.”
The company expects to begin hiring staff shortly after raising capital.
“This is not my number but a number provided to me by a NSW parliamentarian. The suggestion was that the indirect employment generated from the operation would be as high as 600 people in the Armidale region,” said Peter Thomas.
At this stage the company is looking to operate the mine from Hillgrove, with no offices planned for Armidale.
Antimony is used for several products and is becoming more commonly known as a strategic metal. It is a relatively rare metal and is used primarily in the manufacture of lead acid batteries, PET plastics like water bottles and various military uses as a fire retardant.
“It has an emerging use in the processing of computers,” said Peter Thomas.
“Apparently it is used in the new generation of chips and thumb drives and they are all likely to start having minute quantities of antimony in them.
“Nevertheless you don’t have to be a Rhode Scholar to realise that there are a lot of these devices and even minute quantities quickly add up.”
Peter Thomas believes that current owners Straits Resources have done a wonderful job with the mine, investing well over $100 million at the Hillgrove site, leaving it in excellent condition, however there are three primary reasons why Emu Nickel is confident it can make it work.
“Firstly when Straits Resources closed the mine, the price of gold was $450 an ounce and the price of antimony was about $6000 a tonne,” said Peter Thomas.
“Secondly the price of gold now is in excess of $1600 an ounce, and the price of antimony is $13,000 a tonne and going upwards.
“Thirdly we believe that the dynamics in the antimony market have changed in the last few years, with supply capability out of China declining rapidly.”
Chairman Peter Thomas is a retired lawyer with a close association with the resources sector and the mining industry. He is also a farmer, who lives on a property within earshot of the Hillgrove Mine, so he understands how intrusive mining operations can be for those people who don’t directly benefit from them.
“I also appreciate the very significant benefit that mines can bring. It is a difficult balance, one which we hope we get right,” said Peter Thomas.
Story: Jo Harrison
