Neometals (NMT) - $30M Helps Focus the Plan
Neometals is an innovative mineral and advanced materials company focused on a sustainable future. The company seeks to de-risk and develop long-life projects with strong integrated partnerships throughout the value chain. The company is listed on the Australian Stock Exchange (ASX: NMT).
The company's major projects include a Lithium-Ion battery recycling plant, a lithium refinery, the Barrambie Titanium, and Vanadium project, and a vanadium recovery plant.
We met with Christopher Reed, Managing Director, and CEO, Neometals, and Jeremy McManus, General Manager-Commercial and Investor Relations at Neometals.
Christopher has over 3 decades of experience in the mining industry and is the founder of Reed Resources. He currently serves as a member of the AusIMM and was formerly the Vice President at the Association of Mining & Exploration Companies.
Jeremy has more than 20 years of experience in the resource and technology materials sector. He previously served as a Commercial Manager for Talga Resources. Over the course of his career, he has been involved with corporate finance, funding, and advisory roles across investment banking and accounting sectors. Jeremy specializes in technology commercialization, capital markets, IP management, and corporate governance.
Neometals is a mineral and advanced material company involved in the recycling, and production of high-grade lithium and vanadium. The company was founded in 2001 and is headquartered in Australia. Alphamet Management Pty. Ltd, Mount Finnerty Pty. Ltd., Reed Advanced Material Pty. Ltd., Mt Edwards Lithium Pty. Ltd., Barrambie Gas Pty Ltd., and Innovation Pty. Ltd (formerly Australian Vanadium Exploration Pty. Ltd.), are the companies' subsidiaries.
Neometals has multiple ongoing projects in the supply chain for Lithium-ion batteries for the EV (Electric Vehicles) and energy storage sectors. They also have recycling projects for upstream mineral concentrates. The company recently signed an MOU (Memorandum of Understanding) with a Canadian company called Stelco, and is working towards a JV (Joint Venture) on recycling end-of-life batteries.
The company's nickel exploration project is in the process of being turned into a dedicated ASX-listed vehicle. They also published a resource update on the Mt Edwards site which includes several individual deposits.
De-merging the Mt Marion Mine
Neometals raised AUD$30M by selling the offtake rights to their lithium hydroxide project at the Mt Marion Mine. This was done as the company previously faced limitations on trading their spodumene concentrates. The market price for spodumene concentrates has seen strong growth with prices going from $375/t to $650/t.
The company is looking to focus on the holding patterns and has placed streaming plans on hold for the near future. They are currently working towards a material recovery strategy with a strong focus on the ESG (Environmental, Social and Corporate governance) component and sustainability.
Battery Recycling Plant in Germany
Neometals is currently in the final phases of its battery recycling plant which is being carried out in a JV with the SMS group called Primobius GmbH. The company is currently in the process of commissioning the demonstration plant. The next step is to carry out demo trials, which are scheduled to conclude by September 2021, after which the company will either put out a class 3 resource or feasibility study level OpEx and CapEx to reach a decision.
The company seeks to conclude the entire process by March 2022 and consider carrying out an FID (Final Investment Decision) by the end of the month.
The Vanadium Recovery Project
At the Vanadium recovery project, the company is running the pilot plant, more than half of which has already been concluded. The next step would be to carry out a Class 3 Engineering Cost Study that is scheduled for completion by 30th June, with an FID planned in December 2022.
It is important to note that the company's recovery and recycling projects have low carbon footprints and the vanadium project has a potential for a net negative carbon footprint. This means that the material being produced won't release any NOx in the atmosphere and the water will continue to be potable. The company has developed the operation to capture the CO2 from the emissions, which will be leached into carbonic acid for potential use in building products. Additionally, the other byproduct of the operation, Ammonium sulphate can be utilized as a fertilizer.
Barrambie Titanium Vanadium Project
Neometals's Barrambie project is a traditional mineral operation where multistage crushing is carried out through spirals, leading to the production of a gravity concentrate. The company plans to export this supply to China for smelting, which will lead to the production of titanium slag and iron vanadium slag. The company is currently working towards getting compliance listing done for this project on the AIM (Alternative Investment Market).
This project offers the cheapest nickel producing costs from battery recycling with the lowest carbon footprint. This site features the world's second-highest grade hard rock titanium-vanadium deposit. The titanium-vanadium project offers the highest-purity vanadium with the lowest quartile costs in the world.
At the Barrambie titanium vanadium project, the company has already received ministerial approval from the local jurisdiction. The company is carrying out trial mining and is sending the supply to China for further processing. The company intends to enter an offtake agreement similar to Mr.Marion. As this is an advanced nickel project, it has the potential for an attractive per metric price.
Mt Edwards Nickel Project
Neometals's de-merged asset features 10Mt nickel mineralization for 160,000 nickel-metal tons, out of which more than two-thirds belong to the inferred category. 90% of the assays are historic in nature and have only been utilized for nickel mining.
The company is currently in the process of growing its nickel asset while working towards de-merging and returning the property back to the shareholders. They have an arrangement with the shareholders where every x number of Neometal shares will provide a free sharing Widgie (Widgiemooltha town) nickel resource to the shareholders.
The company currently has 160,000 stock in nickel metal tons spread across 11 nickel sulphide deposits, located 50km from BHP's nickel concentrator. The company plans to expand the site and carry out infill drilling. This will allow the company to recover nickel, copper, cobalt, platinum, palladium, and gold. The company has already carried out studies that show that multiple deposits of metals coexist with the nickel sulphide ore bodies.
Additionally, the company's 11 deposit features up to 4 historic mines which have significant remnant resources. This is spread across a land area of 300 square kilometers, where the resources already have mining leases in place. The de-merged property will be analyzed through a pre-feasibility study before mining approvals.
The company's class 4 OpEx (Operational Expenditure) and CapEx (Capital Expenditure) Lithium battery recycling project has demonstrated economic viability and scalability. To achieve this, the company has signed a MOU with Hitachi and are looking for a hub-and-spokes arrangement similar to their North American holdings.
The company is looking to become the lowest-cost nickel producer globally while working towards scaling up its operations. When it comes to material recovery, their first priority is nickel, followed by cobalt and lithium. The company is taking a disciplined approach towards prioritizing its operations along with an intricately planned risk-reward strategy.