The engineering, procurement and construction contract award is part of Western Areas’ mill enhancement project to boost mill recoveries by 3-5% over the life of mine.

The project relies on Western Areas’ Biloeach technology, allowing nickel recovery from a tailings stream with high nickel content from one of the flotation plants.

While the metal could not be recovered into concentrate using traditional flotation methods, the Bioleach process is expected to add up to 1200 tonnes of recovered nickel concentrate per annum.

The project will start immediately, with GR expected to pocket about $7 million in revenue in the first half of the 2015-16 financial year.

The remaining amount is expected to be realised once Western Areas approves the start of the six-month construction phase, which is likely to be later this year to match forecast nickel price recovery with the completion and commissioning of the mill’s enhancement. At this stage, Western Areas believes commissioning and ramp-up could begin July 1 next year.

Western Areas managing director Dan Lougher said the mill enhancement was expected to produce attractive economic returns, with estimates rating the internal rate of return at 39% over a 39 months payback period using consensus nickel prices of $US8.68 a pound at an Australian dollar exchange rate of 80 cents.

“This is another example where Western Areas will deploy relatively modest capital to generate operational efficiencies in a structured, smart and disciplined manner,” Lougher added.

“We are extremely pleased to be working with GR Engineering as they have been involved with the

Forrestania mill since its original construction and expansion.”

GR built the project’s Cosmic Boy processing plant in 2009 and upgraded it in 2010.

GR Engineering managing director Geoff Jones was pleased to continue the firm’s association with Western Areas’ Forrestania processing plant.