Ardea Resources (ASX:ARL) and its consortium of Japan-based partners are stepping closer to a final agreement regarding a Definitive Feasibility Study (DFS) for the Kalgoorlie Nickel Project (KNP) – Goongarrie Hub in Western Australia.
After first signing a memorandum of understanding (MoU) for the work back in July 2023, Ardea says the parties have now reached an agreement on the scope and budget for the DFS services, subject to further discussions and signing binding final agreements.
The Japanese consortium comprises Sumitomo Metal Mining and Mitsubishi Corporation.
Ardea says the consortium has completed its due diligence process, which included ‘extensive’ site visits and technical meetings, and the parties will now aim to sign final agreements by the end of March 2024.
Once signed, the parties will formalise the process of forming a joint venture to facilitate the completion of the KNP Goongarrie Hub DFS ahead of a final investment decision (FID). Ardea and the consortium will also work together to secure funding for the project’s development.
Given that the progress towards the DFS comes amid turmoil in the global nickel market, Ardea Managing Director and CEO Andrew Penkethman says commercial discussions with the consortium are continuing as a ‘priority’ for the company.
“It is pleasing to see nickel added to the Australian Critical Minerals list and the nickel sector receiving state and federal government support.
This initiative reiterates that Australia and key ally nations remain focussed on supply chain diversity and security, with planning for the KNP Goongarrie Hub taking into account the high ESG standards expected by modern democratic society.
With the long-term fundamentals for nickel remaining strong, Ardea and the consortium continue their proactive engagement and collaboration, which has helped facilitate significant progress in finalising the KNP Goongarrie Hub DFS scope of work and budget.”
Ardea says as it progresses talks with the Japanese consortium, it has continued to work with support consultants to advance early DFS workstreams, including a more detailed review of in-pit tailings disposal.
Meanwhile, with the consortium’s due diligence now complete, the exclusivity arrangements in place mean Ardea must now cease discussions with any other interested parties that had commenced due diligence for the KNP Goongarrie Hub under a previous strategic partner process.
Once final agreements are in place, Ardea and its Japanese partners will work to develop Goongarrie to become a ‘globally significant’ producer of nickel.
Images: Ardea Resources
