Conico flags resource expansion potential ahead of Mt Thirsty scoping study

Conico says latest drilling at its Mt Thirsty cobalt-nickel-manganese-scandium Joint Venture project in WA have highlighted unrealised growth potential to the east.

The project has a current JORC Resource of 66.2Mt at 0.06% cobalt, 0.43% nickel, 0.45% Manganese, and these latest assays from Phase I drilling last year have intersected three distinct zones of flat-lying horizontal mineralisation across the eastern licence area – including an upper zone consisting of a weathered ultramafic peridotite rock hosting nickel-cobalt-manganese-scandium mineralisation.

Results include:

48.0m at 0.08% Co, 0.44% Ni, 0.13% Mn & 47.6 g/t Sc from 2m, including 6m at 0.14% Co, 0.62% Ni, 0.85% Mn & 57.4 g/t Sc from 5m (MTRC005D);
70m at 0.05% Co, 0.45% Ni, 0.47% Mn & 36.3 g/t Sc from 3m, including 26m at 0.11% Co, 0.59% Ni, 1.06% Mn & 28.2 g/t Sc from 47m (MTRC006D) and;
29m at 0.09% Co, 0.62% Ni, 0.73% Mn & 33.2 g/t Sc from 0m, including 13m at 0.15% Co, 0.62% Ni, 1.36% Mn & 34.1 g/t Sc from 6m (MTRC007D).

Notably, the majority of the results sit outside the current mineral resource estimate, highlighting the potential for resource growth.

Scandium could be a valuable by-product

The drilling was also intended to investigate the project’s scandium potential – which had not previously been assayed for, and is not included within the existing resource estimate.

It could represent a valuable by-product revenue stream, with the global scandium market projected to reach US$977.3 million by 2030, growing at a forecasted compound annual growth rate (CAGR) of 8.7% from 2022 to 20305.

“The latest drilling results continue to highlight the potential of Mt Thirsty to provide a low-cost, ethical, and sustainable source of cobalt and nickel outside of the Democratic Republic of the Congo and Russia,” Conico (ASX:CNJ) executive director Guy Le Page said.

“Significantly, the majority of these results remain outside of the recently published Mineral Resource Estimate and present an opportunity for further resource growth and potentially mine life extensions.

“The Mt Thirsty project is uniquely positioned to support the continued decarbonisation of our economy, not only containing cobalt and nickel, but also hosting manganese and scandium, allowing the Project to potentially produce a high value pCAM product.

The current price of scandium oxide is A$1,376,600/t; cobalt is A$55,500/t; nickel is A$37,800/t and manganese is A$3,200/t6.

Scoping study expected in July

A scoping study is currently underway at Mt Thirsty assessing adoption of HPAL and production of pCAM, which could potentially transform the project’s economics.

Comparable HPAL projects typically receive Co and Ni recoveries of 90% and 92%, respectively, and pCAM typically receives a ~50% pricing premium over intermediatory products (MHP/MSP).

“We are entering into a transformational phase for the Mt Thirsty project with metallurgical studies progressing that will feed into a Scoping Study that is expected to be completed in July,” Le Page said.

Conico expects that the scoping study, leveraging off a materially larger resource will provide the foundation for a potential ownership consolidation and IPO of the Mt Thirsty project later this year, followed by a pre-feasibility study, which will seek to supply a low-cost, ethical and sustainable source of cobalt and nickel outside of the Democratic Republic of the Congo and Russia.

This article was developed in collaboration with Conico Limited, 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.