Looks like BHP are getting set to tackle Ravensthorpe deposit. I...

Looks like BHP are getting set to tackle Ravensthorpe deposit. I think Wingellina is a similar style deposit so will be interesting to see how BHP does.

BHP to tackle Ravensthorpe's laterite14:48 AEST Tue May 20 200819 minutes agoBy Ben Sharples

BHP Billiton Ltd's $US2.2 billion ($A2.31 billion) Ravensthorpe nickel laterite project in Western Australia may prove a shining light in a sector that has been plagued by failure and disappointment.

The world's largest mining company will Friday officially open the Ravensthorpe operation south of Perth, four years after giving the go-ahead for the project.

Nickel laterite projects, however, have a chequered history in WA and have the claimed the scalps of a notable few, including Joe Gutnick and Australia's richest man, Andrew Forrest.

Laterite ore is low-grade and requires intensive processing to produce a saleable material.

Mr Gutnick's Centaur Mining & Exploration Ltd went into receivership in 2001 amid commissioning problems and budget blowouts associated with its Cawse operation, while Mr Forrest was ousted from the board of Anaconda Nickel Ltd after problems with its Murrin Murrin project.

Anaconda, a company which Mr Forrest founded, was later restructured and rebadged as Minara Resources Ltd.

BHP Billiton signed off on a $US1.05 billion ($A1.1 billion) investment for Ravensthorpe in March 2004 as part of an integrated development with the Yabulu nickel refinery near Townsville in Queensland.

Ravensthorpe's development, however, has not been without the cost and delay headaches plaguing most project's in the resources space.

In October 2006, BHP Billiton's Stainless Steel Materials president Chris Pointon exited the company amid talk that he had become a scapegoat for a second cost-blowout and further delays to the mine schedule.

Capital costs soared by 70 per cent to $US2.2 billion ($A2.31 billion) less than 12 months after BHP Billiton issued its first cost increase for the mine development.

Ravensthorpe will employ a process combining pressure acid leach and atmospheric leach to produce a mixed nickel and cobalt product, which will be shipped through the Port of Esperance for refining at Yabulu.

The mine is expected to produce about 50,000 tonnes per year of nickel when it is fully operational.

But, finishing construction and commissioning is only half the task when it comes to nickel laterite operations and Minara Resources knows all too well the problems that can be thrown up.

The company completed construction of its high-pressure, acid-leaching Murrin Murrin operation in 1999 but was struck with numerous expensive repairs and is yet to reach its nameplate capacity of 40,000 tonnes of nickel per year.

"Ravensthorpe should be a lot me reliable from an operational reliability point of view and there should be a lot less hiccups than those experienced in the early stages with Murrin Murrin," Fat Prophets analyst Gavin Wendt said.

"They have had a number of years to learn from the Murrin Murrin experience."