Nico Resources is advancing drilling, metallurgical studies and a potential downstream battery-materials partnership at Wingellina, despite a subdued nickel market and a larger annual loss. The company ended FY2026 with $4.73 million across cash and short-term investments after raising $3.73 million in equity.
- FY2026 net loss widened to $989,296
- Wingellina resource totals 187.4 million tonnes
- First-stage drilling targets 94 South Domain holes
- Non-binding MOU signed with Pure Battery Technologies
- $4.73 million held in cash and short-term investments
Wingellina advances despite weak nickel economics
Nico Resources Limited (ASX:NC1) is continuing to prepare its long-delayed Wingellina nickel-cobalt project for development, even as the company acknowledges that depressed nickel prices and Indonesia-led oversupply remain a major obstacle for new producers.
The Central Musgrave project hosts a 187.4 million-tonne Wingellina mineral resource grading 0.91% nickel and 0.06% cobalt, containing 1.697 million tonnes of nickel metal and 105,300 tonnes of cobalt metal. The company also reports a probable ore reserve of 168.4 million tonnes containing 1.56 million tonnes of nickel and 123,000 tonnes of cobalt, with a proposed operation capable of producing about 40,000 tonnes of nickel and 3,000 tonnes of cobalt annually in mixed hydroxide precipitate for at least 42 years.
Those figures remain based on studies and estimates rather than an operating mine. Nico’s own report says development depends on further technical work, funding, approvals, infrastructure and market conditions.
Drilling targets a more detailed resource model
The company has begun a first-phase infill drilling program in Wingellina’s South Domain, comprising 94 reverse-circulation holes for about 6,062 metres. The work is intended to tighten the geological model, improve density data and support the conversion of some Indicated Resources to the Measured category.
Nico says a full 25-metre by 25-metre drilling pattern across the deposit could require about 200,000 metres of additional RC drilling. Rather than undertake that program at once, it is focusing on higher-grade areas expected to feature in the first 10 years of a potential operation. The drilling will also supply samples for additional variability testing and the company’s planned geometallurgical model.
That model is designed to link ore characteristics with recovery, acid consumption, slurry behaviour and the value of individual mining units. It is a practical step, but not a development decision: the next test will be whether the technical detail can translate into an investable project under prevailing nickel prices.
Metallurgy points to processing advantages and constraints
Metallurgical work continues to support high-pressure acid leaching as Wingellina’s preferred processing route. Nico says 86% of the resource is modelled as limonite or transitional limonite, while testwork found that rejecting coarse, low-grade and acid-consuming material could improve acid efficiency by up to 15% and increase HPAL feed grade by up to 7%.
The same work highlights the engineering trade-off. Finer particles can improve leaching, but excessive grinding increases slurry viscosity and pumping requirements. The current processing concept therefore combines wet de-agglomeration with selective grinding of the coarser nickel- and cobalt-bearing fraction, with further studies intended to establish design data at definitive-feasibility-study level.
Battery-materials partnership remains exploratory
In May, Nico signed a non-binding memorandum of understanding with Pure Battery Technologies to assess an integrated supply chain from Wingellina’s proposed mixed hydroxide precipitate through to nickel-manganese-cobalt precursor cathode material. The parties plan to examine processing hubs in Australia, the United States and Europe, including potential integration with PBT’s operating refinery in Hagen, Germany.
The memorandum creates a framework for joint technical and commercial studies and discussions with government and funding partners. It does not commit either company to a final investment decision or a definitive commercial agreement, so its immediate value lies in the work still to be done rather than in contracted revenue.
Funding extends runway but does not remove risk
Nico raised $3.73 million before costs in January through the issue of 12.44 million shares at 30 cents each. At 30 June, it held $792,883 in cash and $3.94 million in short-term investments, while operating cash outflows reached $1.03 million and exploration expenditure capitalised during the year totalled $1.28 million.
The company reported a net loss of $989,296, wider than the $702,661 loss recorded in FY2025. It says its working-capital surplus was $4.98 million and that directors considered it able to meet obligations for at least the next 12 months, but the report also identifies future funding as a material risk for continued exploration and any eventual mine development.
Nico’s preferred logistics route would run by road from Wingellina to Leonora and then by rail to Esperance. That option depends partly on the staged sealing of the Great Central Road, with about 736 kilometres of the Western Australian section still unsealed and planned for completion through 2032. Water exploration, heritage consultation, approvals and negotiations with Traditional Owners also remain part of the project’s development path.
Bottom Line?
Wingellina is becoming more technically defined, but the decisive milestones remain a stronger nickel price, credible development funding and a binding pathway beyond the exploratory PBT memorandum.
Questions in the middle?
- Can the first South Domain drilling materially increase Measured Resources or improve the project’s mine plan?
- What capital requirement will emerge from the next stage of HPAL, water and infrastructure studies?
- Will Nico and Pure Battery Technologies convert their non-binding framework into funded downstream agreements?