Nickel companies in North America got a shot in the arm after Tesla Inc (NASDAQ:TSLA) CEO Elon Musk urged miners to produce more nickel, a key ingredient in the batteries that power the company's electric cars.
“Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” Musk said on a post-earnings call last week.
Nickel makes batteries energy dense so cars can run further on a single charge, and Tesla needs the silvery-white metal as it looks to ramp up production of trucks and solar projects that use a lot of nickel.
Canada Nickel Company Inc, which has already exchanged messages with Musk on Twitter, said it is “excited” to take the Tesla boss up on his challenge to efficiently mine nickel.
Anchored by its flagship Crawford nickel-cobalt sulphide project in the heart of the Timmins-Cochrane mining camp in Ontario, the company is building a nearly $1 billion facility that will process zero-carbon nickel. The company's property sits on one of the dozen largest known deposits of nickel sulphide.
The company has created a wholly owned subsidiary NetZero Metals, and has applied for trademarks for the terms NetZero Nickel, NetZero Cobalt, and NetZero Iron in the US, Canada and other jurisdictions.
“The electric vehicle industry and many other consumer sectors needs zero-carbon metal this decade – not in a nebulous 2050 timeframe contemplated by many other resource companies,” said Canada Nickel CEO Mark Selby.
“As a result of the unique advantages of the Timmins region with its close proximity to zero-carbon hydroelectricity and our Crawford nickel-cobalt sulphide project, comprised largely of serpentine rock that naturally absorbs carbon dioxide (CO2) when exposed to air, Canada Nickel has the potential to develop zero-carbon products that our customers are expecting from the mining sector,” he added.
Studies have shown that serpentine rock found liberally at the company’s Crawford project naturally absorbs carbon dioxide when exposed to air. This is fortunate as typical nickel processing using laterite and sulphide ores leaves a large environmental footprint in the shape of sulfur dioxide and CO2 emissions.
Strategic source of US supply
Meanwhile, Toronto-based Talon Metals Corp (TSE:TLO) (OTCPINK:TLOFF) which is advancing its polymetallic Tamarack project in Minnesota could become a strategic source of US supply for the EV battery market. What’s more, the coronavirus (COVID-19) pandemic is highlighting the need to focus on domestic supply chains.
“You can count on one hand the number of high-grade nickel sulphide discoveries globally over the last decade or so that are not already in the hands of majors — they’re few and far between,” Talon president Sean Werger told Proactive.
“Ultimately, even Tamarack’s “low-grade zone” (approximately 0.6-1% nickel plus byproduct metals) is considered to be high-grade compared to most other nickel projects. This suggests that Tamarack will be a low-cost producer that will be economic in virtually any nickel environment. Unlike most other nickel projects, we are not reliant upon the nickel price to increase significantly for the Tamarack project to work.”
Progressive Planet’s nickel finds
Meanwhile, Progressive Planet Solutions Inc (CVE:PLAN), a low-carbon cement products company, recently revealed results from its soil geochemical and outcrop sampling program which showed anomalous nickel over a 500 metre strike length at the company’s Heffley Creek property in British Columbia.
“Additional samples of soil and outcrop in the defined nickel-in-soil anomaly have been placed on a rushed testing schedule and we anticipate that our soil geochemistry testing program will continue into the Fall of 2020 until the weather prohibits soil sampling,” said Progressive Planet CEO Steve Harpur.
“With the announcement on July 30 that we had increased our optioned area from 20 claims to 69 claims, we have significantly more ground to explore before winter."
Last week saw a 4.5% spike in the nickel price following Musk’s public challenge to miners. The cost per tonne dipped to US$11,000 at the end of March but has since recovered to around US$14,000.
A word of caution here, stainless steel producers are still by far the biggest consumers of the silvery-white metal, so the price will ebb and flow with demand for items as basic as cutlery.
Up and comers
Here are some of the up and coming juniors that might step up to meet increased demand from electric car makers and help to bolster supply in the coming years.
American Manganese Inc (CVE:AMY) (OTCPINK:AMYZF)
The critical metals company is focused on the recycling of lithium-ion batteries with its RecycLiCo patented process which provides high extraction of cathode metals, such as lithium, cobalt, nickel, manganese, and aluminum at high purity, with minimal processing steps. The company aims to commercialize its breakthrough process and become an industry leader in recycling cathode materials from spent lithium-ion batteries.
Its key project is Knaften, which hosts high-grade gold and copper-nickel targets. All are open for expansion and further discovery. The company also holds two nickel-copper-cobalt deposits, Lappvattnet and Rormyrberget, which are to the east of Knaften.
It owns the Crawford nickel-cobalt sulphide project, a discovery with large-scale potential in an established mining camp north of Timmins, Canada. Its initial resource is in the top 12 nickel sulphide resources globally.
Progressive Planet Solutions Inc (CVE:PLAN)
It is one of Canada’s largest low-carbon cement products companies and recently reported that results from its soil geochemical and outcrop sampling program showed it has anomalous nickel over a 500 metre strike length at its Heffley Creek property in British Columbia.
Talon Metals Corp (TSE:TLO) (OTCMKTS:TLOFF)
It has a joint-venture with mining major Rio Tinto on the high-grade Tamarack nickel-copper-cobalt project in Minnesota. This comprises a large land position (18 kilometres of strike length) with numerous high-grade intercepts outside of the current resource area. Tamarack North has an NI 43-101 mineral resource estimate of 3.7 million tonnes in the indicated category and an additional 3.12 million tonnes classed as inferred.
The Brazil-focused group is developing the Araguaia ferronickel project and the Vermelho nickel-cobalt project, in the Carajás mineral district. Araguaia will become the next major nickel mine in the country when production starts in 2022.
Nickel is a key component of the Alotta project in southwest Quebec, Canada, and recent diamond drilling has returned up to 17 metres at 1.67% nickel, 2.12% copper, 5 g/t silver and 1.9 g/t PGE from 48.5 metres, including 8.5 metres at 2.05% nickel, along with 6.9 metres at 2.46% nickel, 2.48% copper, 24.5 g/t silver and 4.9 g/t PGE from 81.8 metres. The results have encouraged the company to make further exploration plans.
Contact the author Uttara Choudhury at [email protected]
Follow her on Twitter: @UttaraProactive
-- Angela Harmantas contributed to the article --