Battery materials developer Australian Mines has raised $6.5 million to fund sample production from its precursor cathode active material (P-CAM) pilot processing facility at its proposed Sconi project in Queensland.

This is a vital step for the company with P-CAM, nickel and cobalt sulphate samples an important element in securing binding offtake agreements with global battery and vehicle manufacturers.

Australia’s current battery sector is mostly mining raw materials, contributing an estimated $1.3 billion to our GDP but could be worth $7.4 billion annually to Australia’s economy by 2030 according to Accenture, creating 34,700 jobs if we were to establish and further support downstream sectors, such as refining raw materials further to chemicals and active materials – and that’s where Australian Mines’ (ASX: AUZ) single source, development ready Sconi Project could fit in.

Increasing interest in downstream battery materials market

The company will issue around 342.1 million shares at $0.019 per share and says the placement will also fund exploration activities, the acquisition of additional tenements, and general working capital.

“The placement is an indication of the strengthening battery materials market and Australian Mines’ future role as a large-scale, long-life battery materials producer,” Australian Mines Managing Director Benjamin Bell said.

“We will now be producing P-CAM samples in addition to continuing to produce nickel and cobalt sulphate samples, which will help secure offtake agreements with various international battery and motor vehicle manufacturers.”

The company has completed the design for its pilot P-CAM processing facility – which is expected to materially improve Sconi’s project economics with an added NPV of $352 million.

The next step is to progress offtake negotiations with a range of global car and battery manufacturers and enter into a binding offtake agreement for Sconi by the end of this calendar year.

Sconi scoping study shows EV product potential

The company plans to commence pre-feasibility studies (PFS) later this year for Sconi P-CAM facility after releasing a scoping study last month.

The study focused on leveraging the project’s unique nickel-cobalt-manganese (NCM) mineral make-up to deliver a more refined and higher value P-CAM product for NCM and other nickel-rich battery customers.

The recent study highlighted Sconi’s capacity to deliver single source, NCM P-CAM production (used in the majority of EV battery cells this year) with the optionality for more intermediate saleable products such as a mixed sulphide precipitate (MSP) or nickel/cobalt/manganese sulphate.

This was an added advantage for potential offtake partners as well as potential cost advantages through a single source arrangement – especially considering the looming supply constraints for the EV industry around battery grade nickel and cobalt from 2023.

 

 

 

This article was developed in collaboration with Australian Mines, a Stockhead advertiser at the time of publishing.

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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