SK Innovation, page-29

thats from 3rd jan catsar



Reassurances over planned job creating mine north of Townsville
TONY RAGGATT, Townsville Bulletin
January 3, 2019 6:01pm
Subscriber only

A COMPANY planning a $1.3 billion nickel and cobalt project northwest of Townsville has sought to reassure the market the development is still in play and that its key client, Korean oil and chemical giant SK Innovation, remains committed.
Listed development company Australian Mines Ltd issued a statement to the Australian Securities Exchange yesterday after questions were raised in The Australian newspaper about the project’s viability and SK Innovation’s involvement.
It comes as two deadlines, related to project financing and SK Innovation’s potential investment in Australian Mines, passed without being met and prices for the metals have plunged.
Australian Mines is proposing three open cut pits and a two million tonne per annum processing plant at Greenvale, producing nickel and cobalt sulphate.
The company announced last year that SK Innovation had signed a binding term sheet to acquire all of the project’s production, including an option to acquire up to 19.9 per cent of the company’s shares at a price of 12c, a potential investment of more than $80 million, by December 31.
The company’s share price has fallen from about 12c at the time of the announcement to 4c and SK Innovation has not taken up the option.
Also, a condition of the term sheet that Australian Mines obtain finance by December 31 to develop and construct the project has not been met.
Australian Mines announced on Thursday both deadlines had been extended.
The company has given SK Innovation until February 20 to exercise the option and retain a “modest” commercial in confidence buyer discount, while it says both parties have agreed to extend the period in which Australian Mines can finalise financing until September 19.
Australian Mines managing director Ben Bell said the extensions without renegotiation of other terms was evidence of SK Innovation’s continued support of the project.
The company said both parties continued to work collaboratively to finalise and execute an offtake agreement during the current quarter.
SK Innovation is investing $1 billion in building a 7.5 GWh a year electric vehicle battery plant in Hungary, due to begin production in early 2020, and already produces batteries at a capacity of 3.9 GWh a year at its Seosan factory in Korea.
Originally published as Cobalt mine development still in play