Lunnon Metals (ASX:LM8) said it completed a scoping study on the Baker deposit and Foster mines nickel sulfide mineral resource in Western Australia based on 7% measured, 84% indicated and 9% inferred resource category material, indicating that the projects present as potentially economic, even at the current downturn in nickel prices, according to a Monday Australian bourse filing.

A production target of 700,000 tonnes to 720,000 tonnes at around 3% grade of nickel for 21,000 tonnes to 21,600 tonnes of nickel metal was defined for the Baker deposit. Meanwhile, a target of 700,000 tonnes to 750,000 tonnes at around 3.3% grade of nickel for 23,000 tonnes to 24,000 tonnes of nickel metal was defined for the Foster mine.

Each mine is forecast to operate for between four and four-and-a-half years, averaging an attributable 3,500 tonnes of nickel per annum per mine. All-in costs of AU$390 per tonne to AU$400 per tonne of ore are modeled for Baker, with AU$490 per tonne to AU$500 per tonne for Foster.

The study was completed to a level of plus-or-minus 30% accuracy. The firm's board decided not to characterize this study as higher than at the scoping study level, despite the detailed level of analysis for all parameters except processing, due to uncertainty surrounding any potential nickel processing agreement.