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FPX Nickel Corp. (TSXV: FPX) (OTCQB: FPOCF) (" FPX " or the " Company ") is pleased to provide an update on value engineering (" Value Engineering ") studies focused on the mineral processing and infrastructure facilities for the Baptiste Nickel Project (" Baptiste " or " the Project ") in central British Columbia . The mineral processing and infrastructure Value Engineering studies have achieved significant value creation through facility optimization, flowsheet refinement, enhanced operability, and improvements to the project build strategy and execution basis.
Highlights
- Primary crushing: Changing from a gyratory-type primary crusher to mineral sizers has reduced earthwork and structural quantities, improved Phase 1 operability, and eliminated the need for a second primary crushing circuit in Phase 2
- Concentrator expansion: A new integrated approach to the Phase 2 expansion has reduced overall quantities, improved Phase 2 operability, and reduced the footprint of process and infrastructure facilities
- Project phasing: The phased approach and throughput rates in the preliminary feasibility study (" PFS ") have been validated, while acceleration of the Phase 2 expansion improves Baptiste's metal production profile
- Execution schedule has been confirmed, further validating the PFS's estimated three-year construction duration
"Results from our mineral process and infrastructure Value Engineering studies have added significant value to the Baptiste Nickel Project," commented Andrew Osterloh , the Company's Senior Vice President, Projects & Operations. "By reducing quantities, improving operating efficiency, and advancing the project execution plan, we have enhanced Baptiste's potential as a long life, large-scale, low-cost, and low-carbon producer of made-in- Canada nickel units. We look forward to advancing additional engineering studies on the mining and refinery aspects of the Project in advance of commencing a feasibility study."
Background
The Baptiste 2023 preliminary feasibility study (" PFS ") demonstrates the potential to develop a high-margin and low-carbon nickel mine producing an average of 59,100 tonnes per year of nickel over a 29-year mine life (see the Company's September 6, 2023 news release). Due to awaruite's properties, Baptiste has the unparalleled flexibility to produce either a high-grade concentrate (60% nickel) for direct feed into the stainless steel industry (the " Base Case ") or for further refining into battery-grade nickel, cobalt, and copper products for the electric vehicle battery supply chain (the " Refinery Option ").
While the PFS presents robust economics, including a Base Case after-tax NPV 8% of US$2.01 Billion and after-tax IRR of 18.6% at US$8.75 /lb Ni, FPX strives to add further value to Baptiste, focusing on a holistic blend of economics, constructability, operability, risk and ESG considerations.
The key Value Engineering studies pursued by FPX in 2024 are:
- Mineral processing and infrastructure (described herein)
- Mine planning and engineering (to be completed in the third quarter of 2024)
- Refinery planning (to be completed in the third quarter of 2024)
Mineral Processing & Infrastructure Value Engineering Studies
FPX engaged Fluor Canada Ltd. (" Fluor ") and Wood Canada Ltd. (" Wood ") to perform detailed reviews of the 2023 PFS and to conduct mineral process and infrastructure Value Engineering studies. The consultants identified three primary opportunities to add further value, which are described in greater detail hereunder:
- Primary crushing: application of mineral sizers
- Phase 2 concentrator expansion
- Project phasing
As described below, each of the mineral process and infrastructure Value Engineering studies validated several key tenets from the PFS and added significant project value through reduced quantities, improved operability, reduced process operating costs, and reduced process and infrastructure footprint.
Primary Crushing
The PFS considered a gyratory-type primary crusher. In re-evaluating the Project's geotechnical and communication datasets, the Company has identified an opportunity to use mineral sizers for primary crushing. Taking advantage of the modest compressive strength and fractured nature of the Baptiste ore, mineral sizers have added significant value through reduced earthwork and structural quantities, increased operating availability, and the complete elimination of the second primary crushing line for the planned mine expansion from an initial Phase 1 processing throughput of 108,000 tonnes per day (" tpd ") to 162,000 tpd in Year 10 (" Phase 2 ").
Phase 2 Concentrator Expansion
The PFS considered the construction of a standalone processing facility for the Phase 2 expansion from 108,000 tpd to 162,000 tpd. A new approach to expansion is based on an integrated concentrator approach which entails an expansion of the Phase 1 processing facility rather than the construction of a new standalone facility for Phase 2. This integrated approach results in a reduced process and infrastructure footprint, improved Phase 2 operability, and reduced Phase 2 work force requirements.
Project Phasing
A Value Engineering study re-evaluated the phased approach to processing throughput and compared it with a series of single-build scenarios ranging from 80,000 to 163,000 tpd. Following this evaluation, the PFS's phased approach has been validated; however, the Phase 2 expansion has been accelerated to Year 6 from Year 10. This acceleration in metal production is expected to generate improved economics versus the PFS, with the Phase 2 expansion funded from operating free cash flow following the 3.7 year after-tax payback demonstrated in the PFS.
Project Execution
Both Fluor and Wood were assigned further scope to review the PFS's execution basis, including the permanent facility layout, construction sequence, contracting approach, and overall execution schedule. Note that Fluor and Wood jointly executed the detailed engineering and construction management of the nearby Mt. Milligan Mine, which was commissioned in 2013 and is located 80 km east of Baptiste. Mt. Milligan is of comparable size and complexity to Baptiste, which uniquely positions Fluor and Wood to provide relevant context to the Baptiste project execution plan.
Through this additional execution planning effort, numerous scheduling improvements to the PFS were identified, thereby improving the constructability, operability, and maintainability of Baptiste. In addition, increased focus on allowances for temporary construction facilities has improved execution scope assurance ahead of the environmental assessment and permitting processes. Fundamentally, these robust execution planning efforts further de-risk the Baptiste execution schedule, including the PFS assumption of a three-year construction period.
Andrew Osterloh , P.Eng., FPX Nickel's Qualified Person under NI 43-101, has reviewed and approved the technical content of this news release.
About the Decar Nickel District
The Company's Baptiste Nickel Project represents a large-scale greenfield discovery of nickel mineralization in the form of a sulphur-free, nickel-iron mineral called awaruite (Ni 3 Fe) hosted in an ultramafic/ophiolite complex. The Baptiste mineral claims cover an area of 408 km 2 west of Middle River and north of Trembleur Lake, in central British Columbia. In addition to the Baptiste Deposit itself, awaruite mineralization has been confirmed through drilling at several target areas within the same claims package, most notably at the Van Target which is located 6 km to the north of the Baptiste Deposit. Since 2010, approximately US $30 million has been spent on the exploration and development of Baptiste.
The Baptiste Deposit is located within the Baptiste Creek watershed, on the traditional territories of the Tl'azt'en Nation and the Binche Whut'en, and within several Tl'azt'enne and Binche Whut'enne keyohs. FPX has conducted mineral exploration activities to date subject to the conditions of agreements with First Nations and keyoh holders.
About FPX Nickel Corp.
FPX Nickel Corp. is focused on the exploration and development of the Decar Nickel District, located in central British Columbia , and other occurrences of the same distinctive style of awaruite nickel-iron mineralization. For more information, please view the Company's website at https://fpxnickel.com/ or contact Martin Turenne , President and CEO, at (604) 681-8600 or ceo@fpxnickel.com .
On behalf of FPX Nickel Corp.
"Martin Turenne"
Martin Turenne , President, CEO and Director
Forward-Looking Statements
Certain of the statements made and information contained herein is considered "forward-looking information" within the meaning of applicable Canadian securities laws. These statements address future events and conditions and so involve inherent risks and uncertainties, as disclosed in the Company's periodic filings with Canadian securities regulators. Actual results could differ from those currently projected. The Company does not assume the obligation to update any forward-looking statement.
Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.
SOURCE FPX Nickel Corp.
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