Company Overview
Binding Cooperation Agreement to form a 50:50 incorporated Joint Venture.
The Company
Kalgoorlie Nickel Project – Goongarrie Hub
Ardea Resources Ltd (Ardea) and the Japanese Consortium (JC), comprising Sumitomo Metal Mining Co., Ltd (SMM) and Mitsubishi Corporation (MC), have entered into a binding Cooperation Agreement to form a 50:50 incorporated joint venture – Kalgoorlie Nickel Pty Ltd (KNPL).
Ardea Resources Limited is developing the Kalgoorlie Nickel Project, Australia's largest Nickel-Cobalt resource and a top 10 global project, awarded Major Project Status by the Australian government.
SMM are most successful in developing and operating nickel-cobalt laterite operations. They currently operate the Coral Bay and Taganito High Pressure Acid Leach (HPAL) nickel operations in the Philippines and the Niihama Nickel Refinery, Harima Refinery, and the Hyuga smelter in Japan. They are fully integrated within both the stainless steel and lithium-ion battery sectors.
MC has decades of project development and operations experience in Australia and globally. They are one of Japan’s largest and premier general trading and investment companies with decades of experience in investing in the Australian resources sector.
The Transaction between the Japanese Consortium, Ardea, and KNPL is a major milestone for the development of the Kalgoorlie Nickel Project – Goongarrie Hub into a globally significant nickel-cobalt operation.
The Cooperation Agreement
The Cooperation Agreement sets out the terms and conditions on which the Japanese Consortium, Ardea and KNPL will fund and conduct the Definitive Feasibility Study (DFS), and upon agreement by the parties and subject to a positive DFS outcome, Front-End Engineering Design (FEED) and Pre-Commitment Activities (PCA), leading to a Final Investment Decision (FID) on the Kalgoorlie Nickel Project (KNP) – Goongarrie Hub.
Funding Contributions
Under the Transaction, KNPL will manage the DFS process, with the JC providing 100% of the funding for the DFS up to a budget of approximately A$98.5 million via staged equity contributions over approximately 18 months. Ardea and the JC will provide technical and commercial input into the DFS.
Ownership Subscription
At the conclusion of the DFS spend, the JC will have subscribed to a 35% ownership in KNPL and retain the right to increase its ownership in KNPL to 50% upon a positive FID decision by the JC. To make an FID, means that project development debt has been secured and the loan documents are ready to be signed.