Ardea Reports 80% Drilling Completion and $12M Cash Ahead of Key DFS Milestones

Robust Progress on Kalgoorlie Nickel Project

Ardea Resources Limited (ASX: ARL) has delivered a comprehensive update on its Kalgoorlie Nickel Project (KNP) – Goongarrie Hub during the March 2025 quarter, underscoring significant advancement towards the Definitive Feasibility Study (DFS) completion. The company reported the completion of approximately 80% of its planned 48,800 metres of Reverse Circulation (RC) infill drilling, with assay results reaffirming the continuity of high-grade nickel-cobalt-scandium mineralisation at key deposits including Big Four and Scotia Dam.

These drilling programs are critical to upgrading mineral resources to the Measured category, supporting potential Ore Reserve upgrades and underpinning the DFS mine planning. Complementary diamond drilling has provided essential geological and metallurgical data, enhancing resource model confidence.

Engineering and Feasibility Milestones

Ardea has awarded major design and testwork contracts to leading engineering firms, including Lycopodium for the Hydrogen Sulphide Plant and Chemetics for the Acid Plant, alongside contractors for the Desalination Plant and ore preparation programs. The process plant design has reached a 30% review milestone, with detailed engineering progressing on critical infrastructure.

The DFS is fully funded up to a budget of A$98.5 million by a Japanese consortium comprising Sumitomo Metal Mining (SMM) and Mitsubishi Corporation (MC). This partnership not only provides financial backing but also strategic expertise, with the consortium earning a 35% stake in the project upon DFS completion and the option to increase to 50% following a positive Final Investment Decision.

Strong Financial Position and Corporate Developments

At quarter-end, Ardea held $12 million in cash with no debt, supported by $64 million of remaining DFS funding from the consortium. Post-quarter, the company completed a $4.6 million placement to SMM at a premium to market, strengthening working capital.

Corporate changes included the retirement of long-serving Executive Director Ian Buchhorn from the board, who remains in a technical executive role, ensuring continuity of expertise. The appointment of ICA Partners as funding strategy advisors signals a proactive approach to optimising project financing post-DFS.

ESG and Community Engagement

Ardea continues to prioritise Environmental, Social, and Governance (ESG) commitments, appointing SLR Consulting as its preferred ESG advisor and advancing Life Cycle Assessment updates. Engagement with First Nations groups and local communities remains active, exemplified by support for the Menzies Community School’s inclusive sensory playground.

The project’s location in a semi-arid environment with stable conditions offers ESG advantages over tropical laterite operations, aligning with global critical minerals supply chain expectations.

Market Context and Strategic Outlook

The nickel and cobalt markets remain volatile, with nickel prices recovering from lows and cobalt prices surging due to supply disruptions. Long-term demand growth driven by electric vehicle and battery storage sectors supports the strategic timing of Ardea’s DFS completion amid a current sector downturn, which the company views as an opportunity to secure skilled resources and contain costs.

Beyond the Goongarrie Hub, Ardea is advancing exploration and scoping studies at its Kalpini Hub and other nickel sulphide and critical minerals targets, aiming to leverage its extensive tenure in Western Australia’s Eastern Goldfields.

Looking ahead, Ardea plans to complete infill drilling, resource updates, metallurgical testwork, and approvals workstreams, while continuing stakeholder engagement and refining its funding strategy in collaboration with its strategic partners.