Alex Dorsch-led Chalice Mining says it’s heartened by preliminary pre-feasibility study metallurgical testwork at the company’s Gonneville project near Toodyay.

The West Perth-based developer told the market early results indicated potential upside from overall metal recoveries – however additional cleaner stage tests would be required in order to quantify the impact.

“The results to date are promising and indicate potential upside for overall metal recoveries and project economics,” Chalice said.

“However, the impact on overall flotation recoveries and project economics can only be quantified once cleaner stages under locked-cycle conditions are completed for all composites and variability samples.

“The cost impacts of additional flotation time and PAX addition in milling are expected to be relatively minor, whereas pre-treatment with acid needs to be assessed in detail to determine the economic trade-off and associated risks.

“Chalice is currently of the view that additional collector use in milling, as well as increased flotation residence time, are more likely to provide an optimal outcome.”

As it stands, three of seven composites at Gonneville – a palladium and platinum, nickel and copper project – have been tested from 17 metallurgical drill holes, with completion of the program continuing throughout the remainder of the year.

Chalice says the current focus of its PFS, which is likely to finish in the middle of next year, is based around three key components.

Aside from completing detailed metallurgical testwork, the developer aims to assess the feasibility and cost options regarding open-pit and underground mining during Gonneville’s initial development phase, along with determining key infrastructure requirements.

After flagging in January it would reduce spending by 40 per cent due to weak market conditions in the platinum group and nickel metals sectors, Chalice has enjoyed success in relation to progression at Gonneville.

In the company’s March 2024 quarterly report, the company said that aside from having  $104 million cash in the till, it had reduced its operating cashflows by 55 per cent from the previous December 2023 quarter.

On April 8, plans to develop the project were submitted to the Environmental Protection Authority, with Chalice aiming to begin building in 2027, along with targeting first production two years later.

Two weeks later, Gonneville’s mineral resource estimate was updated, containing 3.8 million ounces of palladium and platinum, along with 120,000 tonnes of both copper and nickel.

Chalice shares were down 7 per cent as of 10.33am WST, trading at $1.52 per share.