As SK Innovation prepares for electric vehicle battery production, Australian Mines is supplying necessary materials and recently made a record-breaking shipment.
That’s the largest-known shipment of these ores mined and processed in Australia.
The samples were produced at the company’s demonstration-size processing plant in Perth and were commissioned in conjunction with Simulus Group’s laboratories. Through the final crystallization process, the company achieved over 98 percent purity for cobalt sulfate and 99 percent purity for nickel sulfate.
It is expected that the plant will operate for the next 12 to 24 months, with further battery-grade material being produced for SK Innovation’s battery-manufacturing plants.
The ore will be sourced from Australian Mines’ Sconi cobalt-nickel-scandium project in Northern Queensland. The company predicts that further large-scale delivery announcements of nickel sulfate and cobalt sulfate to SK Innovation will be unveiled in October or November 2018.
SK Innovation will be using the material received from Australian Mines to produce electric vehicle (EV) batteries, and Australian Mines Managing Director Benjamin Bell spoke about how the high-purity products are mutually beneficial.
“Perhaps most significant for Australian Mines’ shareholders is the fact the material mined from Sconi and processed through our demonstration plant has exceeded SK Innovation specifications for purity and may therefore be used directly in the manufacture of EV batteries through SK Innovation’s world-class plants, which is another first for an Australian project,” he said in a statement.
Australian Mines currently has a binding offtake agreement with SK Innovation for 100 percent of cobalt and nickel sulfate produced at Sconi; it is set to last seven years with the option to extend it by six years. The agreement entails SK Innovation taking up to 12,000 tonnes of cobalt sulfate and 60,000 tonnes of nickel sulfate, both per year.
Nickel and cobalt are two major materials used to make cathodes, one of the three primary components in a lithium-ion battery. As the hype surrounding EVs continues to grow, prices for both nickel and cobalt have been on the rise. Some are calling for nickel demand from the battery sector to increase by 20 percent each year over the next decade.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.