Connect with us

Energy & Critical Metals

IPO to watch – NiCo (ASX:NC1) a battery metal player with a globally significant deposit

After spinning out the Wingellina project from Metals X, NiCo will hold one of the world’s largest undeveloped cobalt nickel … Read More
The post IPO…

Published

on

This article was originally published by Stockhead

Listing on the ASX on Wednesday (Jan 19), NiCo Resources (ASX:NC1) may be a little different from the usual late-cycle resources IPOs.

After spinning out the Wingellina project from Metals X (ASX:MLX), NiCo will now hold 100% ownership of one of the largest undeveloped cobalt nickel projects in the world.

NiCo is ‘development ready’ at a time when nickel and cobalt are both in very high demand, with tight supply and strong fundamentals underpinning the commodity prices.

With the deposit now housed in a single purpose vehicle, the company is expected to update the project feasibility and work on the metallurgy optimisation – with testwork underway to assess low capital start-up options.

It should be no surprise given the size of the project that it will need a large capital injection or a partner to develop it, but the pre-feasibility study developed by Metals X indicated that the project should support an initial 40-year mine life at production rate of 40,000tpa Ni and 3,000tpa Co, with a 1:1 strip ratio after 0.5:1 ratio for the first 20 years.

With all the key approvals in place – mining agreement signed with the Native Title holders, water testing and modelling completed, environmental approval received late 2016 – NiCo management are keen to hit the ground as soon as possible.

Even with its current scale, only 25% of the defined geological contact zone has been drilled so there is scope for extensions of the deposit. It is a deeply weathered intrusive, which corresponds with the much thicker and much larger ore body, and being almost 100% limonite means that treatment requires much lower acid consumption than the oft-maligned lateritic deposits.

As well as securing an in-specie distribution for its shareholders, Metals X has elected to reinvest into NiCo with another nickel player, Blackstone Minerals (ASX:BSX) taking up a strategic shareholding. With APAC Resources maintaining their position through their holding in MLX, over 43% of the company will be owned by the top 3.

Raising the full $12m through Marketech and Blue Ocean Equities, the managing qirector of NiCo, Roderick Corps, is looking forward to ringing the bell.

“We believe Wingellina has the potential to be a Tier 1 project. A lot of the hard work was already done by Metals X, which is why they want to maintain exposure. Given the extensive development, in a project hosting some key commodities, we had no problem filling the book. And historically, the project has generated significant interest from major battery metals players including POSCO and Samsung.”

With an $18m market cap at listing (and an EV closer to $7m), and an old prefeasibility study valuing the project at over $3 billion, NiCo should certainly be one to watch, especially with the nickel price reaching a 10-year high last week.

This article was developed in collaboration with Nico Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

The post IPO to watch – NiCo (ASX:NC1) a battery metal player with a globally significant deposit appeared first on Stockhead.



Author: Special Report

Energy & Critical Metals

Cogeneration critical to achieving REPowerEU goals

"Cogeneration can repower and reheat and compliment other clean energy solutions to ensure security of supply…" – Alexandra Tudoroiu-Lakavičė, head…

Continue Reading
Energy & Critical Metals

Bargain Barrel: The red wine that’s suddenly hot

The average price paid for a bottle of Australian grenache has more than doubled over the past two years. Smells … Read More
The post Bargain Barrel:…

Continue Reading
Energy & Critical Metals

These Companies Had The Most Patents Granted In 2021

These Companies Had The Most Patents Granted In 2021

Companies around the world invest billions in R&D to provide cutting-edge innovation…

Continue Reading

Trending