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Mining Project Could Be Carbon Net Zero

Source: Adam Schatzker   01/05/2023

Such a scenario is possible for this nickel-cobalt asset thanks to its owner’s carbon sequestering process,…

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This article was originally published by Streetwise Reports

Source: Adam Schatzker   01/05/2023

Such a scenario is possible for this nickel-cobalt asset thanks to its owner’s carbon sequestering process, noted a Research Capital Corp. report.

Improvements to Canada Nickel Co. Inc.’s (CNIKF:OTCMKTS;CNC:TSX.V) proprietary in-process tailings (IPT) carbonation process are “impressive” on a laboratory scale and, thus, bode well for the explorer’s Crawford nickel-cobalt project in Ontario’s Timmins mining camp, reported Research Capital Corp. analyst Adam Schatzker in a Jan. 4 research note.

“If the testing by Canada Nickel is proven,” Schatzker wrote, “the Crawford project could become a major critical minerals producer while being net zero carbon or perhaps sequestering far more carbon than the project produces.”

Testing of the IPT process revealed two significant findings, noted Schatzker. One, the methodology can be applied to the Toronto-based company’s existing process stream to capture and store carbon dioxide (CO2) at an accelerated rate.

“In the near term, we think Canada Nickel will likely announce some form of financing (likely strategic) that will allow the company to eliminate the debt on its balance sheet,” wrote Schatzker.

Two, in the lab, the IPT process can capture a maximum of 37 tons of CO2 per ton of nickel produced. The amount to be captured routinely, however, is likely to be lower, and the nadir is not yet known, Schatzker wrote.

Regardless, extrapolating this result to the much larger scale of the Crawford project suggests the process would sequester a “very significant amount of CO2,” noted Schatzker, more than enough for Crawford to achieve carbon net-zero status, noted Schatzker. The feasibility study of Crawford is now expected in Q2/23.

Ways To Improve the Project

Schatzker pointed out that by integrating the IPT process into Crawford, Canadian Nickel might qualify for and benefit from some type of governmental incentive. One possibility is Canada’s existing refundable investment tax credits that range from 37.5–60% between 2022 and 2030 and from 18.75–30% between 2031 and 2040. These specific credits, Schatzker noted, would greatly improve Crawford’s economics.

“In the near term, we think Canada Nickel will likely announce some form of financing (likely strategic) that will allow the company to eliminate the debt on its balance sheet,” wrote Schatzker.

Also, the analyst purported the IPT process would work best with “a point source of concentrated CO2,” generated through a vehicle such as a natural gas generating plant or a blue hydrogen project.

“This approach,” he added, “while broadening the scope of the overall project, may make it more attractive from a carbon/environmental, social, and governance perspective.”

Research Capital has a Speculative Buy rating and a CA$2.70 per share price target on Canada Nickel, the current share price of which is about CA$1.76.

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Disclosures:
1) Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.

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3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.

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5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. 

Disclosures For Research Capital Corp., Canada Nickel Company Inc.,  January 4, 2023

Analyst Certification: I, Adam Schatzker, certify the views expressed in this report were formed by my review of relevant company data and industry investigation, and accurately reflect my opinion about the investment merits of the securities mentioned in the report. I also certify that my compensation is not related to specific recommendations or views expressed in this report. Research Capital Corporation publishes research and investment recommendations for the use of its clients. Information regarding our categories of recommendations, quarterly summaries of the percentage of our recommendations which fall into each category and our policies regarding the release of our research reports is available at www.researchcapital.com or may be requested by contacting the analyst. Each analyst of Research Capital Corporation whose name appears in this report hereby certifies that (i) the recommendations and opinions expressed in this research report accurately reflect the analyst’s personal views and (ii) no part of the research analyst’s compensation was or will be directly or indirectly related to the specific conclusions or recommendations expressed in this research report.

General Disclosures: The opinions, estimates and projections contained in all Research Reports published by Research Capital Corporation (“RCC”) are those of RCC as of the date of publication and are subject to change without notice. RCC makes every effort to ensure that the contents have been compiled or derived from sources believed to be reliable and that contain information and opinions that are accurate and complete; RCC makes no representation or warranty, express or implied, in respect thereof, takes no responsibility for any errors and omissions which may be contained therein and accepts no liability whatsoever for any loss arising from any use of or reliance on its Research Reports or its contents.

Information may be available to RCC that is not contained therein. Research Reports disseminated by RCC are not a solicitation to buy or sell. All securities not available in all jurisdictions.

Company Specific Disclosures: Within the past 12 months, Research Capital has provided investment banking services to the issuer. The Analyst currently owns or is short shares of the issuer, which represents less than 1% of shares outstanding.

Potential Conflicts of Interest: All Research Capital Corporation (“RCC”) Analysts are compensated based in part on the overall revenues of RCC, a portion of which are generated by investment banking activities. RCC may have had, or seek to have, an investment banking relationship with companies mentioned in this report. RCC and/or its officers, directors and employees may from time to time acquire, hold or sell securities mentioned in our Research Reports as principal or agent. RCC makes every effort possible to avoid conflicts of interest, however readers should assume that a conflict might exist, and therefore not rely solely on this report when evaluating whether or not to buy or sell the securities of subject companies.

RCC USA: Information about Research Capital Corporation’s Rating System, the distribution of our research to clients and the percentage of recommendations which are in each of our rating categories is available on our website at www.researchcapital.ca. The information contained in this report has been drawn from sources believed to be reliable but its accuracy or completeness is not guaranteed, nor in providing it does Research Capital Corporation assume any responsibility or liability. Research Capital Corporation, its directors, officers and other employees may, from time to time, have positions in the securities mentioned herein. Contents of this report cannot be reproduced in whole or in part without the express permission of Research Capital Corporation. US Institutional Clients – Research Capital USA Inc., a wholly owned subsidiary of Research Capital Corporation, accepts responsibility for the contents of this report subject to the terms and limitations set out above. US firms or institutions receiving this report should effect transactions in securities discussed in the report through Research Capital USA Inc., a Broker – Dealer registered with the Financial Industry Regulatory Authority (FINRA).

( Companies Mentioned: CNIKF:OTCMKTS;CNC:TSX.V,
)

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