Official opening of Anaconda Nickel's Murrin Murrin project

September 15, 1997

The site of Anaconda Nickel's $900 million Murrin Murrin nickel project - one of Western Australia's biggest resource projects and Australia's biggest nickel development - has been officially opened today.

WA's Resources Development Minister Colin Barnett commemorated the beginning of infrastructure development at Murrin Murrin by officially opening the site's airstrip.

"Murrin Murrin represents the new face of WA's nickel industry," Mr Barnett said.

"There will be full processing from ore to nickel metal on site, confirming the growing importance of nickel in the State's vast resources portfolio.

"The project is very significant for the Goldfields and WA and will have an impact across the whole of the State, including the North West Shelf gas fields, Fremantle Port and Westrail's rail network."

Australian content on the project, due for commissioning in the third quarter of next year and full production early in 1999, is expected to be approximately 80 per cent. Significantly, an Adelaide-based company, Australian Submarine Corporation (ASC), was successful in winning the $100 million contract to construct the projects autoclaves.

"Historically, this form of fabrication has been carried out by North American firms," Mr Barnett said.

"However, through the efforts of the Department of Resources Development and the Industrial Supplies Office, ASC not only won the Murrin Murrin contract, but also the contract for autoclaves at the Cawse and Bulong nickel projects, representing work totalling $150 million."

The Minister said that while the Murrin Murrin project was a fly-in, fly-out operation, he was pleased 20 per cent of the workforce would be drawn from local Aboriginal communities and there were other benefits that would flow to the nearby towns of Leonora and Laverton.

"Murrin Murrin's construction workforce will peak at 2,000 during construction and will create 450 permanent jobs," Mr Barnett said.

"Using the multiplier effect, an additional 1,500 jobs could be created in WA.

"Field and drilling teams have already been based in Leonora, while other project staff are being recruited from the area. Senior personnel are being encouraged to live in the town and a permanent on-going exploration field team will remain local. The project workforce will also be able to participate in community activities in Laverton and Leonora, given their close proximity to the mine site."

When commissioned, Murrin Murrin will produce 45,000 tonnes per annum of nickel and 3,000 tonnes of cobalt metal. The processing route uses acid pressure leaching to extract metals from the lateritic ore. Nickel and cobalt are separated by solvent extraction and produced as metals by electrowinning.

An acid plant on site will convert sulphur to sulphuric acid and create sufficient waste heat to provide 80 per cent of the project's energy requirements.

Ore reserves of 117 million tonnes containing one per cent nickel and 0.07 per cent cobalt have been delineated at Murrin Murrin. The life of the project could be as high as 30 years.

"The economic significance of the project is that direct revenue to the State is in the order of $20 million per year," Mr Barnett said.

"A further $20 million will be paid to Government trading enterprises. Revenue from the project will be in the order of $550 million per year."

Mr Barnett said rising long-term international demand for nickel was a significant reason for the commodity's long-term positive outlook.

"Nickel prices have risen by nearly 50 per cent since 1993, from $US 5,000 per tonne to around $US 7,300 per tonne, with prices forecast to increase further this year to an average US $8,025 per tonne before rising to US$9,000 in 1998," he said.

"The future looks bright for the industry and also for the Goldfields where seven other new nickel projects, worth $2.3 billion, are being considered for construction over the next few years."

WA currently produces 10 per cent of world nickel supplies, the fourth largest producer in the world. Increased production will see a strengthening of the State's position as a major player in the world nickel industry.

Media contact: Justine Whittome (08) 9222 9699