Australian Mines Ltd has completed the transaction to acquire 100% of the Sconi cobalt-nickel-scandium project in northern Queensland from its previous joint venture partner Metallica Minerals. The transaction included the payment of A$3.5 million in cash to Metallica Minerals . The company will also issue A$1.5 million worth of Australian Mines shares to Metallica Minerals on completion of its BFS (which remains on track for delivery by April 2018) plus a final issue of A$5 million of Australian Mines shares (or cash ) to Metallica Minerals once the Sconi project is in full-scale commercial production.

Australian Mines Managing Director Benjamin Bell commented: “Securing 100% ownership of the advanced Sconi cobalt-nickel-scandium project is a major strategic milestone for Australian Mines, and progresses our plans to become a significant supplier of cobalt to the emerging electric vehicle sector within the next few years.”

“Importantly for our shareholders, who continue to strongly support the company’s positioning as a near-term producer of strategic technology metals, our acquisition of the Sconi Project has no residual royalty payments or value-depleting claw-back measures.

“Controlling 100% of the expected cobalt sulphate and nickel sulphate production from Sconi provides Australian Mines with far greater scope and flexibility during our current off-take discussions, which are now at an advanced stage, as well as project financing discussions as the Company can now ‘speak’ for the full annual production of these highly sought-after battery metals.

“Australian Mines’ focus for the remainder of 2017 and the first quarter of 2018 is on delivering the BFS on Sconi, in line with its previously announced completion timing of April 2018. Recent work as part of the BFS has supported the view that the expected average feed grade at the project to be 0.11% Co and 0.81% Ni for at least the first 20 years of the operation.

“The company has also made significant progress on finalising the total capital expenditure required to build the proposed open pit mine and full-scale processing facility at Sconi, as well as the forecast operating costs for the life of mine. When available in April 2018, this will allow Australian Mines to take its current project financing discussions to the next level of certainty.”

The demonstration-size plant in Perth is nearing completion with autoclave expected this month; and engineers from potential off-take partners agree with Australian Mines’ cobalt sulphate and nickel sulphate processing flow-chart.