A tug-of-war between two beleaguered mining heavyweights vying to control a piece of prime exploration territory is on the precipice of being decided by a government-run lucky dip.
At exactly the same time on Friday morning BHP Nickel West and Liontown Resources pounced on exploration licences for essentially the same patch of land spanning close to 9 square kilometres.
If both companies stand their ground over the claim — located just north east of Leinster at the top end of the Goldfields — then lady luck will settle who can peg the tenement.
“Both applications were received at the same time; therefore, if an agreement has not been reached by the companies, and if both meet the initial requirements of the Mining Act 1978, they must enter a ballot,” a spokesman from the Department of Energy, Mines, Industry Regulation and Safety told The West Australian.
“If the warden is satisfied that two or more applications meet the initial requirements at the same time or within the set period, the warden will conduct a public ballot unless the applicants agree on priority in writing.”
A public ballot involves the warden placing a token for each application into a container, then drawing tokens from the container one by one to establish the pecking order of the claims.
This would take place at a Warden’s Court, which are peppered throughout the State.
The pursuit of exploration dirt by Nickel West and Liontown is intriguing given both have been battening down the hatches in recent times.
The disintegrating nickel price prompted BHP last month to write down the entire value of Nickel West to the tune of $5.4 billion and issue a warning that it may soon shut down the entire business division, putting 3300 WA jobs on the chopping block.
Meanwhile, a weak price for fellow battery metals commodity lithium has forced Liontown to scale back its flagship Kathleen Valley development, which is set to churn out first product in the middle of this year.
BHP and Liontown both declined to shed light on their motivations for the exploration application, which became available after a previous licence belonging to an unknown entity expired.
The parcel of land slices through a 50km gap between Nickel West’s Leinster operations and Liontown’s Kathleen Valley holding.
The West Australian understands the optimal position of the land plus the relatively meagre cost associated with holding the tenement makes it worthwhile for the duo to throw their hats in the ring.
This is despite both bruised businesses currently facing considerable headwinds if they want to grow their mining footprints.