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Fortune suspends mill expansion at Nico mine on weak cobalt, bismuth prices

Fortune Minerals Ltd. suspended work to expand its Nico cobalt-gold-bismuth-copper project in Canada's Northwest Territories to 6,000 tonnes per day.

The company determined that the current rate of 4,650 tonnes per day is optimum in the current cobalt and bismuth price environment.

"Fortune has concluded that the additional capital required to construct a larger project would not deliver a commensurate increase in cash flows to justify the expansion," the company said Oct. 3.

The company is evaluating opportunities to improve project economics, including a new mine plan based on low cost open pit mining, adjusting the size of the open-pit mine equipment fleet to match the lower mining rate, and finalizing the best site to build the vertically integrated refinery in southern Canada.

Fortune said it will continue discussions with third party processors interested in buying cobalt and bismuth concentrates directly from the mine site, and review options for alliance with other North American cobalt developers for a shared refinery.

The company plans to align the development schedule with the expected deficit in cobalt supply in 2022 and 2023, when demand for batteries in electric vehicles is anticipated to outstrip production, it noted.