Hi there SandyC,It is interesting just how SGQ will manage off...

Hi there SandyC,

It is interesting just how SGQ will manage off takes from Stricklands. Obviously BHP is in the mix due to the first option term attached to the MA acquisition from BHP. Also WSA as a joint venture partner could be involved.

In April this year, Argonaut, in their research coverage, posed this option:

..."While there are a number of existing nickel concentrator plants within trucking distance to the project, we believe the
study (entech) will focus on the construction of a small on-site concentrator plant. This is because regional plants have little capability to
separate the significant by-product metals present at Mt Alexander’s mineralisation, including copper, cobalt, PGEs and rhodium. A
small, 200-400ktpa flotation plant would require minimum upfront capital, but could generate significant cash flow to advance further
exploration and development of a larger scale operation (pending further exploration success)"......

This view expressed by Argonaut would seem to fit with SGQ's metallurgical assessment being carried out by XPS in Canada.

In the latest quarterly report, ...SGQ said......"Laboratory assaying of drill core samples is being completed in Perth. Metallurgical testwork on the samples will be carried out by XPS (Expert Process Solutions) in Canada which has been engaged by St George to
assess the metallurgical performance of the Stricklands mineralisation and to develop a flowsheet for the
potential mining and processing of the Stricklands ore.
A key focus of the work by XPS will be to optimise economic recoveries of all metals in the Ni-Cu-Co-PGE
mineralisation at Stricklands – including the palladium, platinum and rhodium that form the bulk of the
platinum group metals"...

Equally interesting will be the maiden JORC estimate at Stricklands.

Argonaut in an earlier research coverage (Nov 19) estimated that there was circa 50kt of contained ni eq in four mineralised pods. One of those pods is of course MAD71which appears to be the largest of the four MA pods

The definition drill out recently completed may well add to the Stricklands estimate which could conceivably bring its estimate into an order of 20kts ni eq. At current ni prices, this could see revenue of up to A$400,000,000.

Bell Potter in January 2019 estimated a MA operating margin of A$1000 per tonne when the ni price was around A$1500/tonne.

If we play with these figures, operating margin could be circa A$250,000,000 for the LOM at Stricklands

If this plays out as SGQ plans, a significant revenue stream will provide a means of financing wide spread exploration across SGQ's significant tenaments.

AIMO of course

Cheers
Mulac1