Poseidon Nickel Ltd (ASX:POS, OTC:PSDNF) and Pure Battery Technologies (PBT) Pty Ltd have secured a A$119.6 million Modern Manufacturing Initiatives (MMI) Grant from the Australian Federal Government for their proposed development of a battery cathode active material refinery hub in Kalgoorlie, Western Australia.
The government support is a major step forward for PBT’s pCAM Hub, which could be of great benefit to Poseidon by maximising the margins on concentrates supplied to the refinery and potentially unlocking further value by treating a broader range of concentrate specifications.
PBT is targeting initial production of up to 50,000 tonnes per annum (tpa) of precursor Cathode Active Material (pCAM) from the refinery, expandable over time.
Partners PBT and Poseidon are investigating the pCAM Hub project under an MoU executed in October 2021.
The collaboration structure between both parties is yet to be formalised.
“Enhance margins on concentrates”
Poseidon managing director and CEO Peter Harold said: “This grant is wonderful news for Poseidon and PBT and a major vote of confidence by the Federal Government supporting PBT’s plans for the Kalgoorlie pCAM Hub.
“This project will add significant value to the battery minerals it processes and Poseidon is well placed to be a major beneficiary given it has the potential to be a significant supplier of feed to PBT’s proposed pCAM Hub from our existing 400,000 tonne nickel resource base and nickel concentrators at Black Swan and Lake Johnston.
“Given the nature of the processing route, being direct to pCAM, and the proximal location of the proposed pCAM Hub to our mines, there is an opportunity to enhance the margins on our concentrates.”
Major step forward
The support from the Federal Government is a major step forward for PBT’s pCAM Hub, which could be of great benefit to Poseidon by:
➢ Maximising margins on concentrates supplied to the refinery; and
➢ Potentially being able to treat a broader range of nickel concentrate specifications thereby unlocking significant additional value from the company’s large nickel sulphide resource base proximal to Kalgoorlie.
On March 16, 2022, the Federal Government announced “over $243 million in support for four projects under the Collaboration Stream of the Modern Manufacturing Initiative, which will create over 3,400 jobs over time and cement Australia’s place in the rapidly growing critical minerals, electric vehicle and battery markets.
"This includes $119.6 million for Pure Battery Technologies’ $399 million Western Australian pCAM Hub, in partnership with Poseidon Nickel, (who) will build an integrated nickel manganese cobalt battery material refinery hub in the Kalgoorlie region."
The site will become home to a growing workforce with 380 construction jobs and 175 initial permanent jobs from 2023, the government statement added.
Home-grown technology supported
PBT managing director and CEO Bjorn Zikarsky said he was excited PBT’s homegrown technology was being supported by the Australian Government.
“We are excited to deliver our Western Australian project with the support of the Australian Government and our partners Poseidon Nickel. We have developed our technologies from the ground up, working with Australian Universities and research Institutions to ensure we produce cleanest battery materials on the market.
"We look forward to delivering the value from these efforts to the emerging Australian battery materials sector.”
Delivering “exciting project”
PBT chairman Stephen Wilmot noted the value of the investment from the Australian Government and its importance in future-proofing Australia’s emerging battery industry.
“This federal grant from the Modern Manufacturing Initiative will accelerate the growth of the battery materials industry in Australia.
“We thank the government for their significant support and look forward to delivering this exciting new project.”
Poseidon and PBT collaboration
The submission for the grant was made by PBT with Poseidon as the project participant, whereby Poseidon could supply a baseload of nickel concentrate from its proposed Black Swan and/or Lake Johnston to PBT’s proposed pCAM Hub.
Under the MoU, Poseidon and PBT agreed to work together with the ultimate objective of executing a definitive agreement that will detail how the parties can collaborate to fund and develop a regional supply chain from mine to concentrate, to an intermediate mixed nickel-cobalt hydroxide product that will be further refined in PBT’s proposed pCAM Hub.
The receipt of the grant is a major milestone for the pCAM Hub project and will be a key driver for the parties to formalise their collaboration through the proposed definitive agreement.