IGO enters talks to offload Forrestania nickel mine to explorer Medallion Metals
IGO has revealed it is shopping around its troubled Forrestania nickel mine and may have already landed a buyer.
The Ivan Vella-led miner on Thursday told investors it had entered into exclusive talks with West Perth-based gold and copper explorer Medallion Metals to do a deal that would ensure it kept one foot on the region’s prospective lithium deposits.
The talks will run for nine months, with the possibility of a three-month extension, to negotiate a proposal to acquire Forrestania’s Cosmic Boy processing facility and other infrastructure.
“IGO and Medallion also intend to negotiate on a non-exclusive basis the grant of gold and silver rights to Medallion across the Forrestania tenement package,” the miner said.
IGO picked up Forrestania, south of Southern Cross, in 2022 as part of its ill-fated $1.3 billion takeover of Western Areas.
Its full value was later written off entirely and last month IGO announced the mine would be placed on care and maintenance, adding to a string of nickel assets across WA that had fallen to a depressed market for the key battery metal that has been swamped with cheaper supply from Indonesia.
IGO has also placed the once-hyped Cosmos nickel mine near Leinster into care and maintenance while it waits for a recovery..
BHP revealed last month that it would shutter all its WA nickel asset, with that loss of thousands of job, after earlier effectively wiping out the value of the portfolio.
Forrestania’s Flying Fox and Spotted Quoll mines have been in commercial nickel production from 18 years but are nearing the end of their reserves.
“The opportunity to divest the valuable assets at Forrestania to another party, such as Medallion, would be a positive outcome for both IGO and Medallion,” IGO saiud.
“Importantly, IGO will retain lithium and nickel rights at Forrestania.”
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