Independence Group NL (ASX: IGO) today provided an update on the Pre-feasibility Study of its Downstream Nickel Sulphate Project.
The Study is focused on demonstrating a commercially viable process to convert IGOâs Nova nickel-cobalt sulphide concentrate into nickel sulphate, a chemical form of nickel required by the lithium-ion battery industry. This in line with the companyâs objective to produce clean energy metals including nickel and cobalt with interest in both upstream and downstream opportunities.
IGO told that it has developed a new process to produce high-quality nickel sulphate from nickel sulphide concentrate, in respect of which IGO has lodged a patent application. Metal recoveries rate from this process is so high that the company achieved the extraction rates exceeding 97% of both the nickel and cobalt metal in the Nova nickel-cobalt sulphide concentrate feed.
IGOâs Managing Director, Peter Bradford, commented: âNickel is a strategic metal of the future and is poised to benefit from the structural shift to energy storage and electric vehicles, and importantly the transition to increased use of nickel dominant, higher energy density NMC and NCA lithium-ion battery technologies in electric vehicles that deliver better battery performance. This, combined with continued demand growth for nickel from the stainless steel and specialist nickel alloy markets, will transform the industry.â
Nickel sulphate is critically essential in certain electric vehicle battery cathodes, particularly for battery technologies using nickel-cobalt-manganese (NCM) and nickel-cobalt-aluminium (NCA) cathode chemistries.
The companyâs new process named IGO Process is focused on downstream processing studies incorporating innovative processing technologies to more efficiently produce nickel sulphate for electric vehicle batteries, at a lower cost without the requirement to first produce intermediary or refined nickel products.
The report further read that the IGO Process is more environmentally sustainable compared to the traditional production methods for nickel sulphate, due to the methodâs significantly lower emissions, power consumption and waste generation.
âFurther work remains to be done to optimise the process design to minimise waste and maximise by-product credits. The company also continue to do trade-off studies to determine the optimum project location, with key drivers including access and availability of power, water, transportation options, workforce and environment and community considerations. IGO is excited by the results to-date but plans to spend more time to test all strategic options for the Study,â added Mr Bradford.
Going forward, in parallel with the continuing study, IGO intends to commence marketing nickel sulphide concentrate offtake agreements for the period from the expiry of existing contracts in December 2019 and June 2020 until the downstream nickel sulphate project could potentially be operational. The company stated that the offtake terms obtained from this process are expected to be improved as a result of tightening market conditions and will be used to inform the financial evaluation aspects of the Study.
IGO stock price has edged up by 0.61% to trade at $4.950 on 2 April 2019 (12:35 PM AEST). The stock is currently trading at a price to earnings multiple of 57.280x with a market capitalisation of $2.91 billion.
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