Chalice Mining reports significant metallurgical improvements at its Gonneville Project, boosting metal recoveries and revealing a promising iron byproduct that could enhance project economics.
- Improved recoveries for nickel, copper, palladium via flotation and CIL leach
- Discovery of saleable magnetite iron byproduct through low intensity magnetic separation
- Flowsheet optimisations reduce operating costs and support bulk open-pit mining
- Pre-Feasibility Study on track for completion in Q4 2025
- Strong financial position with A$83 million cash and investments
Metallurgical Advances at Gonneville
Chalice Mining Limited has announced a series of metallurgical breakthroughs at its 100%-owned Gonneville PGE-Ni-Cu-Co Project in Western Australia. Following earlier improvements revealed in February 2025, the company has now completed comprehensive testwork across all sulphide mine composites, confirming further gains in metal recoveries. Notably, recoveries for nickel and copper have increased by up to 7% and 5% respectively in fresh sulphide ores, while palladium recoveries have also improved modestly.
These enhancements stem from refinements in the flotation and Carbon-in-Leach (CIL) leach processes, which are central to the project’s processing flowsheet. The new flowsheet simplifies operations and reduces reagent consumption, translating into lower operating costs and improved project margins compared to the 2023 Scoping Study baseline.
A Potential New Revenue Stream: Iron Byproduct
Perhaps most intriguingly, Chalice’s testwork has identified a potentially saleable iron concentrate byproduct, predominantly magnetite, produced via low intensity magnetic separation (LIMS) ahead of the leach circuit. This iron product grades between 64-66% Fe with low impurities, making it attractive to specialist steel mills. The mass pull to this iron concentrate is estimated at 3-5% across sulphide composites, with minimal palladium losses, suggesting it could provide a meaningful additional revenue stream without significant extra processing costs.
Chalice has engaged independent technical and marketing consultants to validate the product’s quality and marketability. While offtake agreements are yet to be negotiated, initial assessments indicate a premium pricing potential relative to standard iron ore benchmarks.
Project Development and Strategic Outlook
The company’s Pre-Feasibility Study (PFS) remains on schedule for completion in the fourth quarter of 2025. The PFS will incorporate these metallurgical improvements and the iron byproduct into an optimised, staged bulk open-pit mining plan. This plan benefits from a low strip ratio and is designed to be competitive even at current bottom-of-the-cycle metal prices.
Chalice’s leadership highlighted the technical team’s persistence through challenging market conditions to unlock these gains. CEO Alex Dorsch described the cumulative improvements as “likely game-changers” for Gonneville, enhancing the project’s competitiveness and lowering the price thresholds required for development. COO Dan Brearley emphasized the robust technical foundations now in place, with no significant impediments remaining to project advancement.
In parallel with technical work, Chalice continues to engage Mitsubishi Corporation under a strategic memorandum of understanding to explore marketing and offtake opportunities. Environmental modelling and regulatory engagement are progressing, supported by strong government backing, which bodes well for timely approvals.
Strategic Importance and Market Context
Gonneville’s resource is notable for its scale and polymetallic composition, hosting critical and strategic minerals such as palladium, platinum, nickel, copper, and cobalt. These metals are essential for decarbonisation technologies, urbanisation, and defense applications. The project’s location near Perth offers logistical advantages, including access to infrastructure and a skilled workforce.
Given the geopolitical importance of these minerals and the dominance of supply from countries like Russia and South Africa, Gonneville’s development aligns with broader Western efforts to secure critical mineral supply chains. The project’s designation as a ‘Strategic Project’ by Western Australian and Commonwealth governments underscores this significance.
Bottom Line?
Chalice’s metallurgical advances and new iron byproduct discovery position Gonneville as a more economically robust and strategically vital project, setting the stage for a pivotal PFS conclusion later this year.
Questions in the middle?
- How will the commercialisation and offtake agreements for the iron byproduct evolve?
- What are the detailed cost implications and capital requirements for integrating the new flowsheet at scale?
- How might fluctuating metal prices impact the project’s development timeline and investment decisions?