ANNUAL REPORT2014 CORPORATE
DIRECTORY
DIRECTORS
Ian Macliver
Dan Lougher
David Southam
Robin Dunbar
Julian Hanna
Richard Yeates
Craig Readhead
Tim Netscher
COMPANY SECRETARY
Joseph Belladonna
AUDITORS
Crowe Horwath
Level 6
256 St Georges Terrace
Perth WA 6000
BANKERS
ANZ Banking Group Limited
77 St Georges Terrace
Perth WA 6000
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 2
45 St Georges Terrace
Perth WA 6000
STOCK EXCHANGE
Australian Securities Exchange Limited
Code: WSA
SOLICITORS
Allion Legal
Level 2
50 Kings Park Road
West Perth WA 6005
REGISTERED OFFICE
Level 2
2 Kings Park Road
West Perth WA 6005
PO Box 1891
West Perth WA 6872
Phone: +61 (0) 8 9334 7777
Fax: +61 (0) 8 9486 7866
Email: info@westernareas.com.au
ABN: 68 091 049 357
COMPETENT PERSON STATEMENT
The information in the Annual Report that relates to Exploration Results, Mineral Resources and Ore Reserves is based on information compiled by Mr
Charles Wilkinson, Mr Andre Wulfse and Mr Daniel Lougher, who are Competent Persons and members of The AusIMM. They are full-time employees of
Western Areas Ltd. Mr Wilkinson, Mr Wulfse and Mr Lougher have sufficient experience that is relevant to the style of mineralisation, type of deposit under
consideration and to the activity being undertaken to qualify as Competent Persons as defined in the 2012 Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves. Mr Wilkinson, Mr Wulfse and Mr Lougher consent to the inclusion in the report of the matters
based on his information in the form and context in which it appears.
FORWARD LOOKING STATEMENT:
This Annual Report contains certain forward-looking statements including nickel production targets. Often, but not always, forward looking statements can
generally be identified by the use of forward looking words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”,
or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production and
expected costs.
These forward-looking statements are subject to a variety of risks and uncertainties beyond the Company’s ability to control or predict which could cause
actual events or results to differ materially from those anticipated in such forward-looking statements.
This announcement does not include reference to all available information on the Company and should not be used in isolation as a basis to invest in Western
Areas. Any potential investors should refer to Western Area’s other public releases and statutory reports and consult their professional advisers before
considering investing in the Company.
CONTENTS
Chairman’s Letter
Managing Director’s Report
Highlights
Operations Review
Western Areas Ore Reserve /
Mineral Resource Statement
Exploration Report
FinnAust Report
Directors’ Report
Corporate Governance Statements
Auditor’s Independence Declaration
Financial Statements
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Opinion
Tenement Listing
Shareholder Information
02
04
07
08
18
20
28
29
47
53
54
59
109
110
112
118
WESTERN AREAS LTD
ANNUAL REPORT 2014
1
CHAIRMAN’S
LETTER
DEAR FELLOW
SHAREHOLDERS,
On behalf of your Board of
Directors, I am pleased to present
to you the Annual Report for the
year ended 30 June 2014. In my
first year as independent Chairman
of the Board, I am very pleased to
report on a significant change in
the nickel market over the course
of the year, with prices rising some
36% throughout FY14, mostly in the
second half of the year. The nickel
price strength, coupled with our
average US dollar exchange rate
falling from $1.03 to $0.91, has
had a positive effect on our
Company’s finances.
Crucially, we’ve maintained
our operational performance
throughout the year, allowing the
Company to reap the full benefit
of the improved pricing for nickel.
Western Areas seeks to do all it
can to implement a cost base and
balance sheet that is sustainable
through the highs and lows of the
nickel price cycle. I am pleased to
report that we still maintain our
position as one of the lowest cost
producers of nickel in Australia.
The nickel price rise in the second
half of the year was largely
attributable to the Indonesian
Government’s implementation of
a ban in early 2014 on the export
of unprocessed nickel laterite
ore. The objective of the ban was
to encourage the development of
a domestic processing industry,
rather than seeing raw product
shipped off to other countries for
value adding processing.
Indonesia was previously a major
supplier of nickel laterite material,
accounting for as much as a
quarter of world supply and as
such the ban has seen a significant
structural change to the supply
side of the nickel industry. The
Indonesian product was also the
primary source of supply for the
Chinese Nickel Pig Iron Industry.
During the year we strengthened
our balance sheet as a result of
$105m capital raising and the
repurchase of $15m of convertible
bonds. At year end, the Company
was in a net cash position (ie. we
held more in cash and liquid assets
than our total debt) for the first
time in 10 years.
IAN MACLIVER
INDEPENDENT
NON–EXECUTIVE CHAIRMAN
2
WESTERN AREAS LTD
ANNUAL REPORT 2014
Looking forward to growth in the coming years, the Company
retains an excellent portfolio of exploration acreage near our
existing Forrestania Nickel Operations.
Essentially, within the next 12
months we will have completely
paid off the original development
funding taken on to build our
Forrestania Nickel Operations.
Collectively, this will lead to a $24
million reduction in borrowing
costs every year post FY15.
Looking forward to growth in the
coming years, the Company retains
an excellent portfolio of exploration
acreage near our existing
Forrestania Nickel Operations. The
core of our exploration efforts will
be focused there, with the potential
for any discovery to be brought
rapidly into production, making
use of our available infrastructure.
We also continue to review a
number of earn in and joint
venture opportunities on advanced
exploration acreage, currently held
by junior resource companies.
During the year we successfully
listed our Finnish assets as a
separate company on the
London AIM market. Capital was
raised as part of that process
to enable exploration to be
undertaken. Pleasingly, early
drilling results in Finland have
returned positive results.
In closing, I’d like to thank the
Company’s Managing Director, Dan
Lougher, the executive team and
all of the employees, contractors
and suppliers of Western Areas
for their hard work and dedication
throughout the year. I would also
like to thank my fellow directors
for their hard work and valuable
insights. I look forward to our
operational excellence, and a
positive nickel environment,
continuing into next year.
Ian Macliver
Independent
Non–executive Chairman
WESTERN AREAS LTD
ANNUAL REPORT 2014
3
MANAGING
DIRECTOR’S
REPORT
With continued strong operational
performance, including an
unrelenting focus on cost reduction
and safety, and a fundamental
change in the nickel market, the 2014
financial year has been a successful
one for Western Areas’ shareholders,
employees and stakeholders.
Production for the year exceeded
expectations, with unit cash costs of
nickel in concentrate in particular
falling significantly compared to last
year, coming in at A$2.50/lb versus
A$2.68/lb for the prior year. The
strong production results flowed
through into our financial results,
with underlying net profit after
tax (NPAT) for the year of $32.6m,
compared to an underlying result of
$5.6m last year.
At the end of the previous financial
year, the Board made a commitment
to increase dividends should
the Company return to material
profitability. Pleasingly, we were able
fulfil this commitment and with the
Company posting a solid financial
result, the Board decided to pay
a final fully franked dividend of 4c
per share. Accordingly, dividends
for the year totalled 5c per share
representing a payout ratio of
approximately 41% of NPAT.
Importantly, we’ve undertaken our
activities in a very safe manner, with
our Lost Time Injury Frequency Rate
(LTIFR) at an industry low rate of 1.9
at 30 June, after briefly touching zero
during the year. At the time of writing
this report, the Company’s LTIFR had
decreased to 1.0. We are very proud
of our safe work culture, and believe
the ability to effectively manage
safety in the workplace goes hand
in hand with our ability to productively
manage all other aspects of
the business.
By managing our mining operations
well, we’ve been able to materially
benefit from the upsurge in the nickel
price created by the Indonesian
Government nickel laterite export
ban. As discussed elsewhere in
the report, we continue to see
evidence building that this will
not be a temporary change to the
nickel market, rather a permanent
structural change tightening up the
world’s supply of nickel.
In particular, the second half of
the financial year saw our realised
nickel price increase significantly
which resulted in Western Areas
ending the year in a net cash
position. Western Areas’ message
to the market during the year was
very clear that the Company was
focused on reducing debt. This goal
has now been achieved with our
balance sheet being substantially
transformed by the retirement of
convertible bond debt subsequent
to year end. Furthermore, with the
last convertible bond debt on track
DANIEL LOUGHER
MANAGING DIRECTOR
& CHIEF EXECUTIVE OFFICER
4
WESTERN AREAS LTD
ANNUAL REPORT 2014
to be retired from cash reserves in
July 2015, the Company will realise
around A$24m in annual debt cost
savings from the commencement
of FY16, including approximately
A$12m in FY15.
Our operational result has been
built on a culture of constant
productivity improvements,
innovation and a strong focus on
costs. Throughout the year we have
implemented a range of operational
enhancements and cost reduction
initiatives. Significantly, a great
number of these initiatives are
proposed from our employees, not
from the “top down”. The ability of
our staff to identify these initiatives
and see them implemented is a
great asset for our Company.
Our Spotted Quoll mine performed
extremely well, easily exceeding
the steady state run rate of 12,000
nickel tonnes per year (actual
13,973 nickel tonnes) and doing
this with zero LTI’s. Spotted
Quoll continues to have a mine
life based on reserves of greater
than 10 years. Flying Fox also
performed strongly, mining over
14,000 tonnes of nickel for the
year. The Cosmic Boy Concentrator
continued its excellent track record
with throughput being 9% above
nameplate capacity and utilisation
around 98%.
The majority of the Company’s
exploration expenditure
continues to be directed towards
the assessment of the highly
prospective greenstone belt
contained within the Forrestania
tenements. As with previous years,
the exploration activities have
been directed towards identifying
new deposits and evaluating
potential extensions to the existing
operations. During the year, our
focus was on the delineation
around the new discovery below
the existing resources at New
Morning. In addition, testing of the
6km zone between the two mines
was undertaken. This area would
be easily accessible from existing
infrastructure and now with a
higher nickel price environment,
the Company is running a number
of internal studies on how to bring
into production a third mine in the
medium term.
Lost Time Injury Frequency Rate (LTIFR)
Total Ore Mined (tns)
Average Mined Grade
Contained Nickel Mined (tns)
Total Ore Processed (tns)
Average Processed Grade
Average Recovery
Contained Nickel Processed (tns)
Nickel Sold (tns)
Average Nickel Price Recieved (US$/tn)
Cash Costs before smelting/refining (A$/lb)
Average Exchange Rate USD/AUD
FY14
1.9
598,959
4.8%
28,686
598,152
4.8%
89%
25,700
25,756
16,458
2.50
0.91
FY13
0.83
555,736
5.0%
27,639
586,254
5.1%
91%
26,918
27,819
16,112
2.68
1.03
WESTERN AREAS LTD
ANNUAL REPORT 2014
5
Throughout the year we have implemented a range of operational
enhancements and cost reduction initiatives. Significantly, a great
number of these initiatives are proposed from our employees, not
from the ‘top down’.
The ongoing challenge for funding
in the junior exploration market
continues to offer Western Areas
a wealth of opportunities to enter
relatively advanced projects for
attractive entry prices. Importantly,
shareholders should understand
that when the Company examines
these opportunities it is done with
in-depth due diligence, with the view
of bringing on a new mining camp.
The Company intends to increase
its exploration spend to $20m for
FY15 which will allow additional
exploration resources to be deployed
into the Company’s projects.
In line with our stated objectives,
the Company’s Finnish exploration
assets were listed on the London
AIM Stock Exchange during
December 2013, as FinnAust Mining
Plc (“FinnAust”). FinnAust raised
sufficient exploration funding for a
highly targeted 18 month drilling
program and is self sufficient with
an in-country geological team and
a modest office in London. Western
Areas of course retains exposure
to any discovery through holding a
majority 68% of FinnAust.
Early drilling success has
been seen with high-grade poly-
metallic mineralisation from
their Hammaslahti target in
Southern Finland.
A high standard of environmental
management has been maintained
at the Forrestania operations. The
Company undertook a number
of key initiatives during the year,
including the completion of a site
wide independent environmental
audit, the development of a site
wide rehabilitation plan and the
completion of a carbon emissions
benchmarking study. The Company
also participated in the Department
of Mines and Petroleum’s Mining
Rehabilitation Fund which has
resulted in relinquishment of all the
unconditional performance bonds.
Western Areas continues to support
a series of biodiversity initiatives
such as funding the Carnaby’s Black
Cockatoo research and is a major
sponsor of Perth Zoo’s Western
Quoll exhibit. The Company also
continues to support The Starlight
Children’s Foundation.
Looking forward into the new
financial year, we have released
guidance around key operational and
financial metrics. Our shareholders
will appreciate that we have a
proud track record of not missing
our targets and working extremely
hard to outperform where possible.
As a group we are tremendously
determined to maintain our
reputation of being a dependable
mining company and will update our
progress towards our goals through
quarterly and half year reporting.
We are prepared to say at this early
juncture that should the nickel
price increase from existing levels
as has been forecast by market
commentators, the Company expects
the financial year to be very strong
from a profitability and cashflow
generation perspective.
This has been an excellent year for
Western Areas shareholders and
I would like to acknowledge all of
our dedicated staff, contractors
and support companies who have
made this result possible. I look
forward to our success continuing
into FY15.
Finally, I would like to take this
opportunity to thank our past
Chairman, Terry Streeter, for his
commitment and leadership over
the past 13 years with the company.
Thank you for your support.
Daniel Lougher
Managing Director
& Chief Executive Officer
6
WESTERN AREAS LTD
ANNUAL REPORT 2014
HIGHLIGHTS
2013-2014
SAFETY
DIVIDEND
Lost Time Injury Frequency Rate
(LTIFR) at an industry low rate
of 1.9 at 30 June, after briefly
touching zero. At the time of writing
this report, the Company’s LTIFR
had decreased to 1.0.
The Board decided to pay a final
fully franked dividend of 4c per
share. Accordingly, dividends for
the year totalled 5c per share
representing a payout ratio of
approximately 41% of NPAT.
COSMIC BOY
CONCENTRATOR
The Cosmic Boy nickel
concentrator achieved its fifth year
of operation during FY14, achieving
a record breaking ore throughput
for the full year of 598,152 tonnes.
ENVIRONMENTAL
Western Areas has better energy
and emissions productivity (per
tonne of contained nickel) than
any other nickel miner reporting
in Australia.
SPOTTED QUOLL MINE
PRODUCTION COSTS
Our Spotted Quoll mine performed
extremely well, easily exceeding
the steady state run rate of 12,000
nickel tonnes per year (actual
13,973 nickel tonnes) and doing this
with zero LTI’s.
Production for the year exceeded
expectations, with unit cash
costs of nickel in concentrate
in particular falling significantly
compared to last year, coming in at
A$2.50/lb versus A$2.68/lb for the
prior year.
FLYING FOX MINE
BALANCE SHEET
Flying Fox performed strongly,
mining over 14,000 tonnes of nickel
for the year.
Balance sheet being substantially
transformed by the retirement of
convertible bond debt subsequent
to year end.
WESTERN AREAS LTD
ANNUAL REPORT 2014
7
Bacterial Heap Leach
Worldwide Patents
Full Laboratory and
Management Team
Bioheap
100%
Finland
VMS Deposits
Polymetallic
Outokumpu Copper
FinnAust
Mining P L C
68 %
Makwa - Ni/PGM
Mayville (M2) - Cu/PGM
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Western Areas Ltd
2 Operating Mines
Flying Fox - Ni
Spotted Quoll - Ni
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Lounge Lizard - Ni
Mt Alexander - Ni
Southern Cross
Goldfields JV - Ni
Traka Resources JV - Ni, W
OPERATIONS
REVIEW
A
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Forrestania
(100%)
o r r e stania
(7 0 % )
F
Diggers South - Ni
New Morning - Ni
Mt Gibb JV - Ni, Au
Lake King JV - Ni
GROUP OVERVIEW
Western Areas Ltd is an Australian-
based nickel miner listed on
the ASX. The main asset is the
100% owned Forrestania Nickel
Operations, 400km east of Perth.
Western Areas is currently
targeting FY15 total annual
production from the Flying Fox and
Spotted Quoll mines of between
25,000 to 27,000 tonnes of nickel
in ore and the production of 24,500
to 25,500 tonnes of nickel in
concentrate from the Cosmic Boy
nickel concentrator.
Sunrise - Ni
Cosmic Boy - Ni
Gold Rights
The Company’s 100% owned
Forrestania Nickel Operation (FNO)
comprises two underground nickel
mines (Flying Fox and Spotted
Quoll), the Cosmic Boy nickel
concentrator and the associated
accommodation village. Flying
Fox is one of the highest grade
nickel mines in Australia and has
been in production since 2006
and the second mine, Spotted
Quoll, commenced underground
high grade nickel ore production
in November 2011. The Cosmic
Boy nickel concentrator achieved
its fifth year of operation during
FY14, celebrating this milestone by
achieving record ore throughput for
the full year.
STRUCTURE
Western Areas is a company limited
by shares that is incorporated and
domiciled in Australia. Western
Areas has prepared a consolidated
financial report incorporating the
material entities that it controlled
during the financial year, which
are shown below along with the
principal assets of each.
8
WESTERN AREAS LTD
ANNUAL REPORT 2014
FNO emergency response/DFES teams responding to a local bush fire
FORRESTANIA SAFETY
At the end of FY14, FNO had a 12 month Lost Time
Injury (LTI) frequency rate of 1.98. The FNO individual
department summary LTI free days is shown in the table
below.
FNO Department
Surface Exploration
Spotted Quoll UG mine
Cosmic Boy Village
Cosmic Boy Concentrator
Flying Fox UG mine
Surface Haulage
LTI free days
2,060
1,170
880
370
350
90
The FNO workforce (comprising both Western Areas
and contractors) has a proactive approach to workplace
risk management which enabled the excellent safety
results across the entire operation. During FY14, there
were more than 200 Job Safety Analyses, 18 major
risk assessments and over 20,000 hazards reported
and actioned. Senior Western Areas managers and
department Safety Representatives have been active
and visible in the work place areas, conducting safety
inspections and audits (80). As a result, four of the
six operational departments are reporting LTI free
days in excess of a year and a fifth is approaching
the same milestone.
An external audit of the OHS safety management system
in December 2013 reported a significant improvement
from the previous year. A site tour by the auditor and
individual interviews showed ‘that there is good OH&S
compliance by both contractors and Western Areas
personnel’.
The FNO Emergency Response Team has put its skills
to good use throughout the year assisting the local
Department of Fire and Emergency Services (DFES)
and the local Volunteer Fire Brigade to contain and
control two bushfires approximately 10kms from site
infrastructure. The emergency response team also
responded to two vehicle related incidents.
FNO emergency response/DFES teams responding to a local bush fire
WESTERN AREAS LTD
WESTERN AREAS LTD
ANNUAL REPORT 2014
ANNUAL REPORT 2014
9
9
Underground Rescue Training
OPERATIONS
REVIEW
FORRESTANIA
ENVIRONMENTAL
ACTIVITIES
Overall, FNO environmental
compliance was maintained
at a high level throughout the
financial year, however there were
two low impact environmental
incidents reported, both during
the June quarter and both due to
pipeline equipment failures. The
environmental impact from these
was minor and the faults repaired
with no re-occurrence.
Strategen Environmental
Consultants were engaged to
undertake an independent FNO
environmental compliance audit
with office preparation completed
during the December quarter and
the field component completed
during the March quarter. The
outcomes of the audit will be used
to guide and update as required the
FNO Environmental Management
Plan during FY15.
Various environmental applications
relating to FNO surface
infrastructure upgrades were
approved by the relevant regulators
throughout the year, as well as
the FNO Rehabilitation and Mine
Closure Plan (RMCP) approved
by the Department of Mines and
Petroleum (DMP) during the
December quarter.
The Company continued
developing the FNO Rehabilitation
Management Plan (RMP) to
enhance and compliment the
current RMCP, which will be
further developed and refined
during FY15.
The provenance seed collection,
sowing, seedling propagation
(utilising the local Talbot Nursery)
and planting programs continued
during the financial year. The Mining
Rehabilitation Fund (MRF) ground
disturbance data submissions
were lodged for all Western Areas
tenement packages during the June
quarter. The Company expects that,
following DMP assessment of the
data and full payment of the levy,
relevant environmental performance
bonds will be relinquished.
The Company continued involvement
in the Carbon Disclosure Project (CDP)
and supplied relevant emissions data
for the most recent reporting period.
CDP reporting for FY14 was finalised
during the June quarter.
Energetics (carbon & energy
consultants) completed a FNO
energy and emissions benchmarking
study during the December quarter
with key findings below:
• Western Areas produces
~11% of the Australian nickel
industry’s contained nickel
tonnes while only emitting
2% of the industry’s carbon
emissions.
• Since Western Areas began
reporting energy and
emissions data under the
National Greenhouse and
Energy Reporting Scheme
(NGER), energy and emissions
intensity has decreased in each
of its three reported years.
• Western Areas has better
energy and emissions
productivity (per tonne of
contained nickel) than any
other nickel miner reporting in
Australia.
During the September quarter,
FNO replaced plastic disposable
food containers with re-useable
food containers for all personnel.
As a result this reduced plastic
and food wastage and has the
associated benefit of also reducing
consumption costs.
10 WESTERN AREAS LTD
ANNUAL REPORT 2014
FLYING FOX MINE
Streeter Decline development was
put on hold during the financial year
to optimise capital expenditure, in line
with a low nickel price environment,
particularly in the first half of
FY14. Lateral capital development
completed to establish the 285 and
295 ore blocks. This also included
128m of capital vertical development
to provide the necessary extensions of
the primary ventilation network and
escape-way ladder systems to allow
stoping activities to commence in
these lower levels of the mine.
The T4 and T5 orebodies are
practically fully developed, however
air-leg development of the narrower
edges of both orebodies continued
during the financial year.
Flying Fox production continued to
be sourced predominantly from the
T5 area using the Avoca longhole
stoping method and supplemented
with some jumbo drill rig flatback
stoping. The Avoca methodology,
using a combination of rock-fill and
Cemented Rock Fill (CRF), continues
to provide stoping flexibility and quick
stope panel turnaround. The T4
area continues to use predominately
conventional longhole open stoping
with minor rock-fill where possible.
During the financial year, a custom
built longhole drill rig was introduced
to trial narrow vein stoping (>= 1.2m
width) from air-leg drives, which has
proved very successful in minimising
ore dilution and speeding up
extraction productivity over and above
hand held mining methods.
SPOTTED QUOLL MINE
By the end of the financial year, the
Hanna Decline was advanced to a
depth of 505m (895m RL) below the
surface with over 2.7km of lateral
decline metres. Approximately 4.1km
of capital mine development has been
completed, as well as approximately
10.9km of total development. The
capital development schedule is on
track to access to the second stage of
the orebody well before the first stage
is complete.
The first stoping district (Block A, 1215
to 1155mRL) was successfully mined
out during the financial year with
almost 100% extraction. The 1230 and
1155 ore drives have been quarantined
to provide access for the high grade
Spotted Quoll North orebody, with
decline and incline development
respectively from these ore drives
commencing in July 14.
The second stoping district (Block B,
1110 to 1020mRL) achieved steady
state production during the financial
year with three stopes available at any
one time to ensure a continuous flow
of ore. Split firing at the narrower ends
of the lower ore drives has proved
successful with additional high grade
ore extracted in an otherwise low
grade section of the ore drives.
The third stoping district (Block C,
1020 to 915mRL) started ore drive
development late in the financial year.
The now well established ‘top-down’
longhole benching using paste-fill has
proven to be a reliable and productive
stoping method with just over 60,000m3
poured for the financial year.
285 South Ore Drive
1020 Ore Drive: Split fired drive face
WESTERN AREAS LTD
ANNUAL REPORT 2014
11
OPERATIONS
REVIEW
MINE ORE PRODUCTION
Tonnes Mined
Flying Fox
Ore Tonnes Mined
Grade
Ni Tonnes Mined
Spotted Quoll - Underground
Ore Tonnes Mined
Grade
Ni Tonnes Mined
Total - Ore Tonnes Mined
Grade
Total Ni Tonnes Mined
FLYING FOX PRODUCTION
Sep Qtr
Dec Qtr
Mar Qtr
Jun Qtr
FY
Total
Tns
Ni %
Tns
Tns
Ni %
Tns
Tns
Ni %
Tns
86,642
83,095
79,328
67,966
317,031
4.8%
4,200
4.6%
3,791
4.1%
3,243
5.1%
3,479
4.6%
14,713
77,097
74,720
71,614
58,497
281,928
5.3%
4,090
4.8%
3,616
4.8%
3,466
4.8%
2,801
5.0%
13,973
163,739
157,815
150,942
126,463
598,959
5.1%
8,290
4.7%
7,407
4.4%
6,709
5.0%
6,280
4.8%
28,686
During the year, Western Areas mined a total of 317,031 ore tonnes at an average grade of 4.6% nickel for 14,713 contained
nickel tonnes which included 109,008 ore tonnes @ 4.4% for 4,750 nickel tonnes from the Lounge Lizard tenement.
SPOTTED QUOLL PRODUCTION
During the year, Western Areas mined a total of 281,928 ore tonnes at an average grade of 5.0% for 13,973 contained
nickel tonnes. The Spotted Quoll underground operations reached steady state production throughout the year,
to date the project has been delivered on time and on budget.
12 WESTERN AREAS LTD
ANNUAL REPORT 2014
COSMIC BOY MILL PRODUCTION
Tonnes Milled and Sold
Ore Processed
Grade
Ave. Recovery
Ni Tonnes in Concentrate
Total Nickel Sold
Tns
%
%
Tns
Tns
Sep Qtr
150,475
Dec Qtr
148,901
Mar Qtr
147,544
Jun Qtr
151,232
4.9%
90%
6,593
6,554
4.9%
88%
6,427
6,409
4.8%
90%
6,344
6,418
4.7%
89%
6,336
6,374
FY
Total
598,152
4.8%
89%
25,700
25,756
During the financial year, the Cosmic Boy Concentrator treated a record breaking 598,152 tonnes at an average ore grade of
4.8% nickel. A total of 173,998 tonnes of concentrate was produced at 14.8% nickel containing 25,700 nickel tonnes. Nickel
recovery for the year averaged 89%. The record throughput was achieved due to the ongoing hard work of the concentrator
production team that has maximised the utilisation of the concentrator that results from the excellent maintenance team
effort that limits downtime to the absolute minimum.
Cosmic Boy Concentrator at dawn
WESTERN AREAS LTD
WESTERN AREAS LTD
ANNUAL REPORT 2014
ANNUAL REPORT 2014
13
13
OPERATIONS
REVIEW
NICKEL SALES
Western Areas continued to deliver
its high quality and sought after
nickel concentrate material into the
offtake contracts of the two current
customers, BHPB Nickel-West and
Jinchuan Group (Jinchuan). A total of
174,903 tonnes of concentrate was
delivered to these two customers’
offtake contracts during FY14 which
contained 25,756 tonnes of nickel.
The current Jinchuan off-take
contract which commenced in March
2013 will be completed ahead of time
during December 2014.
COST OF PRODUCTION
The unit cash cost of nickel in
concentrate (excluding smelting/
refining charges and royalties) for
the full year was A$2.50/lb, being
well below the full year guidance
of