Market study places Sconi as low-cost cobalt and nickel producer

Independent market study places Sconi in the 1st quartile of cost curve for global cobalt sulphate and nickel sulphate production

HIGHLIGHTS:

• Sconi Project expected to take up the position of one of the most competitive cobalt-producing nickel projects in the world according to independent Market Study by CRU International[1]
• Market Study confirms clear need for new suppliers to enter cobalt sulphate and nickel sulphate markets due to prolific demand growth from battery industry, surging on the back of electric vehicle adoption
• Demand for cobalt sulphate expected to exceed 362,000 tonnes of contained cobalt by 2035, representing almost a 15-fold volume increase from the 2018 basis
• Market Study estimated a nickel sulphate supply gap of 1.3 million tonnes of contained nickel metal in 2035
• Premium paid by off-takers for direct delivery of a nickel sulphate endproduct anticipated to increase from 2025

Australian Mines Limited (“Australian Mines” or “the Company”) (Australia ASX: AUZ; USA OTCQB: AMSLF; Frankfurt Stock Exchange: MJH) is pleased to announce that its Sconi Cobalt-Nickel-Scandium Project in North Queensland, once developed, has been forecast to be one of the most competitive cobalt-producing nickel operations in the world by an independent nickel and cobalt sulphate Market Study commissioned by the Company[2].

The Market Study, undertaken by commodity research specialist CRU International, forecasts that the 2025 value-adjusted business costs[3] of the Sconi Project would place it in the 1st quartile compared to other existing and proposed analogous operations globally (see Figures 2 and 3), based on the outcomes of the financial modelling that was released in Australian Mines’ base case Bankable Feasibility Study (BFS)[4].

As it currently stands[5], Sconi is a late-stage, laterite-hosted cobalt-nickel-scandium project with payable metals expected to be produced annually, on average (based on an 18-year mine life), of 8,500 tonnes of cobalt sulphate and 53,300 tonnes of nickel sulphate.

Australian Mines completed a Mineral Resource extension drilling program in late 20186 and expects to be in a position to release an updated Mineral Resource Estimate for Sconi in the March quarter, which will feed into an optimised BFS on the project.

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