Queensland Pacific Metals Ltd (ASX: QPM) announced that it has formally committed to increasing the scale of the TECH Project in Townsville QLD by at least two times from what was originally contemplated in the Pre-Feasibility Study due to strong offtake interest.
The company said that the decision was based on an assessment of key project considerations including market demand, ore supply, environmental approvals, infrastructure, and supply of consumables.
QPM said that the final sizing would be determined by Definitive Feasibility Study and the first production is targeted in 2023. The company reported that the DNi Process™ License was finalised with Altilium Group, facilitating TECH Project expansion.
A major expansion of TECH project
The Townsville Energy Chemicals Hub (TECH) project’s pre-feasibility study had evaluated a scenario of 600,000 wet tonnes per annum. QPM announced that it has now formally committed to increasing the scale of the TECH Project to at least 2x the Pre-Feasibility Study project size.
The company said that the TECH Project will be scaled up to process 1.2 – 1.5M wet tpa ore, with the final sizing to be determined by the Definitive Feasibility Study.
QPM noted that a larger TECH project will have lower capital intensity and higher margins.
Key project considerations
The company said that the initial consideration of increasing the scale of the TECH Project was driven by discussions with potential offtakers and the respective Memorandums of Understanding signed with LG Chem and Samsung SDI. QPM said that the discussions revealed that increasing production of key battery metals nickel and cobalt increased the appeal of the TECH Project to offtakers.
Other key project considerations included ore supply; environmental approvals process; infrastructure capacity and constraints; and supply of consumables.
Project schedule updated
The company announced an updated project schedule, with the finalisation of the scale of the TECH Project and advancement in project approvals and technical work streams.
QPM said that the plant design remains a single leaching train flowsheet. Therefore, construction time would be unaffected by the doubling of production capacity.
QPM announced that first production is targeted for 2023.
Finalisation of DNi ProcessTM license
QPM’s license arrangement was previously governed by a Framework Agreement. As part of the Framework Agreement, QPM and Altilium Groupwere to execute a definitive agreement for licensing of the DNi ProcessTM.
QPM announced that it has now finalised the definitive agreement with Altilium. The key terms include 30-year term; exclusive rights to utilise the DNi ProcessTM within a 100km radius of the Port of Townsville; and ongoing fees for the exclusivity rights and use of the DNi ProcessTM on terms that are commercial in confidence, but are in line with assumptions utilised in the Pre-Feasibility Study.
QPM CEO Stephen Grocott said: “We continue to clear obstacles and create value-add opportunities. The work over the last few months has created an even more attractive and optimal development path.
We look forward to undertaking the DFS and putting together the required commercial arrangements that we need to make the TECH Project a reality. 2021 is shaping up as a busy and exciting year for QPM and its shareholders.”
*Image Source: Queensland Pacific Metals Ltd