Special Report: The company proposing to develop a new battery metals refinery in north Queensland says a scoping study has confirmed the project’s commercial potential and given it the confidence to proceed with the next phase of assessment.

Queensland Pacific Metals (QPM), the private entity that Pure Minerals (ASX: PM1) has an option to acquire, has released the scoping study detailing its plan to establish a refinery in Townsville, processing nickel-cobalt ore imported from New Caledonia under existing supply agreements.

The study assessed an operation processing 600,000 wet tonnes of ore per annum to produce approximately 25,000 tonnes per annum of nickel sulphate, 3,000 tonnes of cobalt sulphate and other valuable co-products including hematite, alumina and magnesium oxide

Upfront capital required to build the refinery is estimated at US$297 million, which includes a contingency of US$65 million and could be reduced through further feasibility and optimisation work.

“The scoping study follows a number of significant achievements by the company over the past 12 months and has confirmed the commercial potential of the project,” said QPM director John Downie.

“Given the positive results, we intend to move forward with further feasibility studies, extensive metallurgical testwork and efforts to obtain the necessary regulatory approvals as soon as possible.”

QPM says it plans to employ the Direct Nickel Process, developed by Direct Nickel Projects Pty Ltd, to process ore supplied by privately owned New Caledonian miners Societe des Mines de la Tontana and Societe Miniere Georges Montagnat SARL at the refinery.

The Direct Nickel Process uses nitric acid under atmospheric pressure to extract all valuable metals from lateritic ore sources and is a key reason the QPM project is less capital intensive than other Australian nickel-cobalt developments based around high pressure acid leach (HPAL) processing technology.

Whereas HPAL plants require the use of complex metal alloys that can withstand high pressure, the Direct Nickel Process will allow the use of standard grade stainless steel, which is readily available, for many of the QPM refinery’s components.

Based on this and other factors, the company estimates that the facility could be completed and ready for commissioning within 12 months of the start of construction.

Prior to its closure in 2016, the Queensland Nickel refinery operated in Townsville for many years, processing ore from New Caledonia.

The legacy is a town eager for new development but also one that is well equipped to service a project such as QPM’s.

Transport infrastructure in the region is more than adequate and the consumables that will be required to operate the refinery such as nitric acid, sulphuric acid and other industrial chemicals can be easily accessed.

The town also hosts a skilled labour force and has significant engineering support.

The founders of QPM, including Downie, were involved in negotiating the original New Caledonian ore supply agreements for Queensland Nickel and all have an intimate knowledge of the business.

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