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OZ gets final tick for West Musgrave project

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Stuart McKinnonThe West Australian
The remote West Musgrave project in WA.
Camera IconThe remote West Musgrave project in WA. Credit: OZ Minerals/TheWest

OZ Minerals says it remains on track for a final investment decision on its $1.1 billion West Musgrave copper/nickel project later this year after securing all regulatory approvals for the development.

OZ said the third and final regulatory approval for a mining licence meant it could begin construction on the remote project 100km east of Warburton.

However the company is yet to finalise a mining agreement with the local Ngaanyatjarra People and is still working to complete an optimisation study.

The news comes after OZ said last month it was considering “various delay options” on the project and the “value and risk scenario for each of those”.

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The West Musgrave update comes a week after news BHP had lobbed a $25-a-share offer for OZ, which values the company at $8.4 billion.

BHP boss Mike Henry is expected to provide a further update on the rationale behind the bid, which was rejected outright by the OZ board, when he hands down the company’s annual results on Tuesday.

West Musgrave involves mining copper and nickel from two ore bodies, Nebo and Babel, via shallow open pits.

OZ’s most recent study on the project suggests it will produce 32,000 tonnes of copper and 26,000t nickel a year over a 26-year mine life.

The company says 80 per cent of the mine’s power will be from renewable sources using a combination of wind and solar with a focus on developing a roadmap to net zero by 2040.

OZ shares were up 9¢ to $25.79 at 11.30am, well clear of BHP’s bid price, suggesting the mining giant will have to offer more.

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