Canada Nickel Looks to be a Leader in Low-Carbon Nickel Production

About Canada Nickel

Canada Nickel Company is a Canadian mining company focused on advancing the next generation of low-carbon nickel projects to supply the high-growth electric vehicle and stainless steel markets. The company is currently anchored by its 100% owned Crawford Nickel-Cobalt project in Timmins, Ontario, which is expected to be a large-scale, low-cost producer of nickel, cobalt and other critical minerals.

Successful Carbon Capture Pilot Confirms Feasibility Design and Commercial Potential

A key part of Canada Nickel’s strategy is utilizing the natural carbon absorption properties of the nickel-rich ultramafic rock at Crawford to develop a novel in-process carbon capture and storage method called In-Process Tailings (IPT) Carbonation. This simple process involves injecting CO2 into tailings generated by the milling process for a short period, which chemically absorbs the CO2 into the tailings while they are still in the processing circuit.

Canada Nickel has now successfully tested this process at a pilot scale, processing over 7 tonnes of tailings at a demonstration plant and confirming the engineering design parameters that will be used for the upcoming feasibility study, expected on October 12, 2023. The company also successfully applied IPT Carbonation to material from a third party project, demonstrating the potential to commercialize this technology more broadly.

Carbon Credits Could Yield Significant Additional Revenue

A consulting study suggests the Crawford project could reasonably expect over C$25 per tonne of CO2 in carbon credit revenues based on current carbon pricing policies, which would provide significant upside on top of nickel production revenue. The study estimated potential demand for over 20 million tonnes of CO2 storage capacity annually from major emitters in the region, well above Crawford’s expected 1 million tonne capacity. This further supports Canada Nickel’s plans to develop a Zero Carbon Industrial Cluster in the Timmins region anchored by Crawford.

The successful test results also increase the likelihood that Canada Nickel will be able to utilize new federal tax credits for carbon capture projects, worth 37.5-60% of applicable capital costs from 2023-2030. This could meaningfully reduce after-tax costs and increase returns for the project.

Feasibility Study Expected to Show Robust Economics

The feasibility study incorporating the confirmed IPT Carbonation parameters is expected on October 12, 2023. Given the company’s positive announcements so far, the study is widely expected to showcase robust economics for a large, low-carbon nickel mining operation at Crawford.

Canada Nickel is also continuing to advance permitting, targeting receipt of key permits by mid-2025. The federal permitting process is progressing well into the second stage. The company aims to begin project construction soon after permits are received.

Poised to Be a Major Supplier of Nickel and Cobalt

The Crawford deposit is estimated to contain 1.9 billion tonnes of resource at 0.24% nickel and 0.013% cobalt, making it one of the largest undeveloped nickel-cobalt resources in the world. With continued exploration success, Canada Nickel believes Crawford could potentially support a mine life of 30 years or more.

This would position Canada Nickel as a major global supplier of the key battery metals nickel and cobalt, which are seeing surging demand for electric vehicle batteries and grid storage. The asset’s low carbon footprint thanks to the IPT Carbonation process makes it particularly attractive to potential electric vehicle and battery partners.

Unlocking Additional Value in Timmins Nickel District

Beyond Crawford, Canada Nickel has assembled a highly prospective, district-scale land package of nickel assets in the Timmins region. This includes options to acquire 100% of five additional nickel targets within 50 kilometers of Crawford. Exploration results to date have been promising, suggesting potential for a multi-generational nickel mining district in Timmins.

Canada Nickel aims to utilize IPT Carbonation across additional properties in the district, which could unlock further carbon credit revenue potential. The company believes Timmins has the potential to anchor a Zero Carbon Industrial Cluster in the region, attracting investment and spurring economic development.

Key Takeaways for Investors

• Canada Nickel’s Crawford project could be a world-class, low-carbon nickel mine positioned to benefit from surging nickel and cobalt demand. The upcoming feasibility study is expected to confirm robust economics.
• The successful testing of the novel IPT Carbonation process is a potential game-changer, enabling significant additional revenue from carbon credits while also improving after-tax economics through tax credits.
• Crawford is estimated to contain one of the world’s largest undeveloped nickel-cobalt resources, which could support multi-decade production. This could establish Canada Nickel as a preferred supplier to battery and EV companies.
• The Timmins nickel district provides significant upside through exploration of wholly-owned regional targets. Crawford has potential to anchor a zero-carbon industrial cluster in Timmins.
• With permitting advancing and development timeline firmed up, Canada Nickel offers investors near-term re-rating potential as Crawford moves from exploration to development. The company’s leverage to in-demand battery metals and carbon credits make it well-positioned to deliver strong investor returns.