Massive Green Nickel Supplier to North America EVs & Stainless Steel Market

• Canada Nickel is advancing the Crawford nickel sulfide project, the second-largest nickel resource and reserve globally
• The company aims to unlock the potential of the Timmins nickel district, which could be the world's largest nickel sulfide district
• Canada Nickel plans to publish seven new resources (8 including Crawford) and six potential discoveries over the next 12 months
• The company expects the Crawford project to be fully financed and permitted by mid-2025, with a construction decision end of 2025, construction in 2026 and production at the end of 2027
• There is a strong global demand for clean, low-carbon nickel to supply the rapidly growing electric vehicle battery market

The Case for Investing in Nickel: Canada Nickel's Promising Projects

Nickel, a crucial metal for the rapidly growing electric vehicle (EV) battery market, presents a compelling investment opportunity. As the world transitions to cleaner energy and transportation, the demand for nickel is poised to soar. One company well-positioned to capitalize on this trend is Canada Nickel.

Canada Nickel is advancing the Crawford nickel sulfide project, currently the world's second-largest nickel resource. However, the company's ambitions extend beyond this single project. CEO Mark Selby believes the Timmins region of Ontario, where Crawford is located, could become the world's largest nickel sulfide district. "We really think [Timmins] will be the world's largest nickel sulfide district and has the potential to put five Crawfords into production in the next 10 to 15 years".

Interview with Chief Executive Officer, Mark Selby

Aggressive Exploration & Development Plans

Canada Nickel is undertaking an aggressive exploration and development program to realise this potential. Over the next 12 months, the company will have seven additional resources (eight, including Crawford) and six potential discoveries as well.

Selby explained, "By this time next year, we'll have eight resources, already establishing this as a district. Number two is we're doing the mineralogy and met work on these deposits to determine how much of the nickel is recoverable."

Leveraging Existing Infrastructure

A key advantage for Canada Nickel's projects is their proximity to existing infrastructure. The properties are located in the established Timmins mining camp with access to major highways, rail lines, pipelines, grid power, and a skilled local workforce."

"All of that infrastructure helps explain why we can deliver a low-grade deposit: We're able to leverage all that existing infrastructure and have a workforce that gets to drive home every night," said Selby. This is far more cost-effective than flying workers in and out to remote sites.

Fully Financed & Permitted by Mid-2025

Looking at the near-term for its flagship Crawford project, Canada Nickel expects to have it fully financed in terms of the overall financing package by the end of 2024. The company is working with major banks on this.

Permitting is also advancing well. Canada Nickel hopes to complete the permitting process by mid-2025 with a construction decision on Crawford to follow. Detailed engineering work is progressing on schedule to enable this timeline. Further ahead, construction will commence in 2026, with production set for the end of 2027.

Strong Economics & Cornerstone Investors

The Crawford project boasts robust economics. The feasibility study shows an after-tax NPV of US$2.5 billion (CAD$3.5 billion) and an IRR of 18%, including carbon capture credits, at a long-term nickel price of $8.75/lb. These are very attractive returns for large-scale, long-life mining projects like Crawford.

The project's promising potential has attracted major mining companies Anglo American, Agnico Eagle and Samsung SDI as cornerstone investors in Canada Nickel.

"The fact that we've got two of the world's biggest mining companies in the story should say they believe in what the underlying economics of these types of projects could look like," Selby noted.

The Global Need for Clean Nickel

Underpinning the investment case for Canada Nickel is the strong demand outlook for nickel, especially low-carbon, responsibly produced nickel for the EV battery supply chain. Nickel demand has grown 10% per year in the first three years of this decade.

With the number of EV battery factories under construction in North America, nickel demand on the continent is set to jump from 120,000-140,000 tonnes currently to 400,000-450,000 tonnes. That will require multiple new large nickel projects to be built. Indonesia will be a major nickel supplier, but it comes with issues around its high carbon footprint and environmental impact.

Selby sees a bifurcation developing in the nickel market, with consumers and investors distinguishing between clean and dirty nickel.

"People concerned about cobalt coming from the Congo are going to be equally concerned about nickel coming from Indonesia," he said. This positions Canada Nickel's projects to potentially earn a premium for their low-carbon nickel.

The Investment Thesis for Canada Nickel

• Canada Nickel offers exposure to rising nickel demand from the EV battery boom through its large, scalable, and well-located projects in a top mining jurisdiction
• The company's flagship Crawford project is already the world's second-largest nickel sulfide resource and reserve, with attractive economics and is expected to be construction-ready by 2026
• Canada Nickel is aggressively exploring its highly prospective land package in the Timmins region to define up to eight nickel deposits and make additional discoveries, pointing to potential district-scale nickel production
• With a current market cap of around CAD$250 million compared to Crawford's after-tax NPV of CAD$3.5 billion, Canada Nickel's valuation could be poised to rerate higher as it continues to de-risk the project and advance its regional exploration
• The company's projects have the potential to supply an increasingly valuable product - clean, low-carbon nickel - in contrast to high carbon footprint production from places like Indonesia
• Large mining companies Anglo American and Agnico Eagle, as well as battery maker Samsung SDI, have given a vote of confidence in Canada Nickel's assets and team through cornerstone investments

Canada Nickel presents a timely opportunity to invest in rising nickel demand, anchored by an advanced, economically attractive project in Crawford and significant district-scale nickel potential in a top jurisdiction. As the company delivers on its exploration and development milestones, it could be poised for a significant re-rating. Investors should consider adding Canada Nickel to their portfolio for EV battery metals supercycle exposure.

The Nickel Market

The global transition to electric vehicles is a megatrend requiring unprecedented battery metals, including nickel. With EV adoption inflecting higher, driven by government mandates, improving economics, and rising consumer acceptance, demand for nickel in batteries is set to surge in the coming years.

Benchmark Mineral Intelligence forecasts that passenger EV sales will rise from 10 million vehicles in 2022 to 36 million by 2030. Battery production will need to scale up immensely to power these EVs. Based on the number of battery factories under construction, North America alone will require 400,000-450,000 tonnes of nickel annually, up from just 120,000-140,000 tonnes today.

This step-change in nickel demand will necessitate the development of multiple new large-scale nickel projects globally. However, not all new nickel supply will be viewed equally. A key theme will be the bifurcation of the nickel market between "clean" and "dirty" nickel.

Consumers are increasingly concerned about their products' carbon footprint and environmental impact, including EVs. Automakers will be under pressure to source low-carbon, responsibly produced nickel, which will likely come at a premium to higher-carbon nickel from producers like Indonesia.

The implications are clear. While the nickel market as a whole will be very tight, low-carbon nickel projects in good jurisdictions could be poised to earn outsized returns. Companies that can supply this product are likely to be re-rated higher as the market recognizes the scarcity value of clean nickel.