Australian Mines Ltd. signed an off-take agreement term sheet with electric vehicle battery manufacturer SK Innovation to sell 100% of the expected cobalt sulfate and nickel sulfate output from its Sconi cobalt-nickel-scandium project in Queensland, Australia, for an initial seven-year term.
SK Innovation has an option to extend the agreement for another six years, according to the Feb. 19 release. The supply agreement covers the annual supply of 12,000 tonnes of cobalt sulfate and 60,000 tonnes of nickel sulfate.
Additionally, SK Innovation secured an option to acquire up to a 19.99% stake in Australian Mines by purchasing 669 million shares at 12 Australian cents apiece.
Australian Mines said it will optimize the project's mining production profile and engineering plans for the processing plant in line with the off-take volume, and completion of the bankable feasibility study has been extended to end of June.
The work will include a modified mining pit shell and production schedule that will optimize the extraction of nickel and cobalt, to keep with the volumes specified in the off-take agreement.
The company purchased the Sconi project from Metallica Minerals Ltd. in late 2017.