Ann: Syerston Nickel & Cobalt Pre-Feasibility Study Completed-CLQ.AX, page-2

Syerston Nickel & Cobalt Pre-Feasibility Study Completed PFS demonstrates the potential for Syerston to become a leading global supplier of nickel and cobalt sulphate to the lithium-ion battery industry Scandium by-product credits provide potential for significant economic upside.

Highlights:
 Project flow sheet designed to produce high purity nickel sulphate and cobalt sulphate products specifically targeted at the fast-growing lithium ion battery (LiB) market

 Non-binding offtake MOUs already in place with key LiB industry customers – discussions ongoing in relation to offtake contracts

 The PFS assessed the economics of an operation to process 2.5Mtpa ore over an initial 20-year period with existing Reserves available for up to 19-years of additional mine life

 Average annual production of 18,730tpa of contained nickel metal equivalent and 3,222tpa of contained cobalt metal equivalent in years 3-20

 Post-tax NPV8 of US$891M (A$1,187M 1 ) and 25% post-tax IRR, assuming long term average nickel and cobalt price forecasts of US$7.50/lb and US$12.00/lb respectively – sulphate product premiums represent further upside pricing opportunity

 Inclusion of scandium oxide (Sc2O3) by-product production (50tpa at US$1,500/kg) increases the post-tax NPV to US$1,233M (A$1,645M) and the post-tax IRR to 30%

 Capital cost of US$680 million (A$906 million) including US$62M (10%) contingency

 Average C1 operating cash cost in years 3-20 of US$2.96/lb nickel, US$0.89/lb nickel after cobalt by-product credits or negative US$0.76/lb nickel after cobalt and scandium by-product credits

 Project a catalyst for significant regional investment and employment opportunities in central New South Wales, with peak construction workforce estimated at 850 people, and steady-state operational workforce at 335 people

 Key work programmes, infrastructure and permits already in place - Project located adjacent to existing road and rail line; water allocation secured; EIS approved; and Development Consent for a 2.5 Mtpa operation previously granted

 Bankable Feasibility Study underway to progress engineering and design and confirm Project economics

Noting the results of the PFS, Co-Chairman of the Company, Robert Friedland, said: “The coming decades will see enormous technological disruption in global energy storage and transportation markets. But this technology revolution is interdependent – it requires the rapid development of new and reliable raw material supply chains to service these fast-growing markets. At its heart, Syerston’s unique mineral resource, when combined with Clean TeQ’s proprietary ion exchange extraction and purification processing platform, has the potential to service a significant portion of global demand for cathode raw material into the lithium-ion battery industry, as well as providing scandium for the next generation of light-weight aluminum alloys for transportation markets.” Clean TeQ’s CEO, Sam Riggall, also commented: “The PFS has demonstrated the potential for an extremely robust project, producing metals at a scale, and in a form, that are becoming increasingly critical in energy and transport supply chains. Market interest in the Project has been very strong, and we look forward to progressively de-risking the development plan and working with potential customers and strategic partners in these supply chains.”

1 PFS Parameters The PFS assessed the economics of a mine with a designed throughput capacity of 2.5Mtpa of autoclave ore feed from Syerston’s near-surface resource for life of mine and, focusing on an initial 20-year period. Table 1 below provides a summary of the key parameters used in the evaluation of the Project. All dollar figures quoted herein are A$ unless otherwise indicated:


More to follow..