Kagara joins the ranks of nickel producers

The Lounge Lizard nickel sulphide deposit has come into production only 18 months after chief executive of Kagara Ltd (ASX: AZL), Kim Robinson, struck a deal for the deposit to be linked with exploration and development of Western Areas' adjacent Flying Fox deposit.
Lounge Lizard's ore is now accessed from the Flying Fox mine.
Robinson said today that ore produced so far from the mine is outside the indicated and inferred resource estimate of 1.15 million tonnes grading 4.6% nickel.
He said the 744 tonnes of development ore produced so far had graded 4.4% and was stockpiled, awaiting treatment through Western Areas' regional concentrator at the Cosmic Boy site.
"The speed at which Lounge Lizard has been developed has been extremely impressive," Robinson said.
"This will generate cash flow from the project far sooner and at significantly less expense than would have been the case had Kagara not struck the joint venture with Western Areas. It is also expected to result in even greater operating and capital cost benefits for both parties going forward.
Under terms of the joint venture, Western Areas will mine Lounge Lizard using access from the Flying Fox decline. Western Areas will manage and operate all aspects of the combined project and Lounge Lizard ore will be treated at the Cosmic Boy nickel concentrator and sold into Western Area's offtake agreements.
In addition to accessing first ore at Lounge lizard, a further 21 diamond drill holes have been drilled from the exploration drive with assay results received for eight holes.
Some of the better intercepts on an ore zone at about 100 metres depth were 3.39 metres grading 8.2% nickel, 3.91m 2 3.6% Ni, 2.45m @ 4.5%, 1.31m @ 6.6% and 1.19m @ 7.1% Ni.
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