<article><p class="lead">Australia-based metals developer Clean TeQ Holdings has completed a definitive feasibility study showing that its Sunrise project in New South Wales has the potential to be a globally significant producer of nickel and cobalt sulphates for the world's rapidly developing battery market, as well as an important producer of scandium oxide.</p><p>The study indicates that Sunrise can support a sustainable, low-cost, mining operation producing high-purity products for a minimum of 25 years, with sufficient ore reserves for more than 40 years, the company said.</p><p>Once ramped up to full production over a period of two years, it is expected to be able to produce 21,780 t/yr of nickel and 4,640 t/yr of cobalt from years two to six, 19,620 t/yr of nickel and 4,420 t/yr of cobalt from years two to 11, and 18,520 t/yr of nickel and 3,450 t/yr of cobalt from years two to 25. </p><p>Scandium oxide capacity is estimated at 80 t/yr, but this could be doubled to 160 t/yr. Sales are conservatively estimated at 10 t/yr. Clean TeQ has an existing agreement with Airbus and Chinalco to develop new lightweight scandium alloys for the aerospace and automotive industries.</p><p>The project delivery model for Sunrise will be determined in the third quarter of this year, with an investment decision anticipated early in 2019. Construction would start soon after this decision is made, the company said. Pre-production capital costs are estimated at $1.3bn, with a payback period of 4.3 years.</p><p>Sunrise's revenue is projected at $14bn in the first 25 years, with earnings before interest, tax, depreciation and amortisation of around $344mn. Cash costs of negative $1.46/lb of nickel are forecast, net of by-products (cobalt and scandium). Net present value is estimated at $1.4bn.</p><p>Long-term pricing for the Sunrise project has been estimated at an average of $7/lb for nickel plus a $1/lb sulphate premium (the current nickel price is around $6.73/lb) and an average of $30/lb for cobalt (the current price is around $36/lb). </p><p>"Technology disruption in electrically driven transport and energy storage is accelerating. Nickel and cobalt sulphate and scandium are expected to be in massive demand as the world rapidly transitions towards a future dependent on renewable energy and electrification of global transport systems," Clean TeQ's co-chairman, Robert Friedland, said.</p><p>"In our engagement with the market, we are seeing no shortage of demand for high quality, battery-grade nickel and cobalt sulphate, and we are confident that binding, long-term sales contracts will be signed in the coming months," Clean TeQ chief executive Sam Riggall said.</p><p>A banking syndicate comprising International Commerce Bank of China, National Australia Bank, Natixis and Societe Generale will soon start work on a debt financing facility that is expected to be in place over the next few months.</p></article>
