(TheNewswire)
Highlights:
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- Jervois expands São MiguelPaulista (“SMP”) Bankable Feasibility Study (“BFS”) scope toinclude a larger pressure oxidative (“POX”) autoclave, and plansto restart the refinery in a fully integrated single stage.
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- Adjusted BFS flowsheet toconsolidate on prior nickel sulphate studies commissioned at SMP byCompanhia Brasileira de Alumínio (“CBA”), to leverage expertisein chemicals production from Jervois Finland and target higher premiabattery markets.
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- BFS outcomes expected to bereleased by end Q1 2022 to include updated capital expenditure andschedule estimates for refinery restart.
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- Agreement with CBA to extend theoutside date for closing SMP acquisition to March 2022, to allow CBAadditional time to renew applicable operating permits.
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- Jervois remains confident in theattractiveness of restarting SMP and its future significance toexpansion of the non-China battery materials value chain.
TheNewswire - 27 September 2021 - Jervois Global Limited (“ Jervois ” or the“ Company ”) (ASX:JRV) (TSXV:JRV) (OTC:JRVMF) advises it is revisingthe scope of the Bankable Feasibility Study (“ BFS ”) for the SãoMiguel Paulista (“ SMP ”) nickel cobalt refinery in São Paulo,Brazil that is underway.
Jervois is revising the scope of the SMP BFS led byAusenco to accommodate technical expertise theCompany has gained through its recent acquisition of Freeport Cobalt(now Jervois Finland), and current nickel market conditions. Due tostrong demand for mixed nickel-cobalt hydroxide products(“ MHP ”) from China’s nickel sulphate refineries, currentpayables are unfavourable for converting this feedstock intoelectrolytic nickel and cobalt metal (the “Tocantins” productformerly produced at SMP).
As such, Jervois will work with Ausenco and leadprocess engineer, Metso-Outotec, on optimising the scale of thepressure oxidative (“ POX ”) autoclave to be constructed in frontof the existing SMP circuit, to accommodate materials produced byJervois’ Idaho Cobalt Operations (“ ICO ”) and othersulphides such as concentrates, mixed sulphides and mattes, inaddition to the hydroxide and carbonate feeds the refinery can alreadyaccommodate.
Increasing POX capacity will lead to higher capitalcost but improved economics due to benefits on metal recovery andoperating costs, together with greater feed flexibility (in additionto sulphides, the POX will be able to process material from lithiumion batteries known as “black mass” and other recycled materials). The POX will also act as an effective debottlenecking initiativeassisting Jervois to reach previous SMP capacity levels.
Final SMP product is also under review in conjunctionwith Jervois Finland with a view to switching product to nickelsulphate rather than metal. Nickel sulphate is trading at asignificant premium to metal, a trend that Jervois’ commercial teamexpects to continue due to the volume of nickelsulphate forecast to be derived from metal dissolution to satisfyglobal demand growth in battery markets.
This switch will be linked to restarting SMP at orclose to its prior capacity, of 25,000 metric tonnes of nickel and2,500 metric tonnes of cobalt. As a result the restart of SMP, andthe associated Ausenco study release, will no longer be staged. Thecompleted Ausenco BFS is expected to be delivered by end Q1 2022 dueto the flowsheet change with the requisite BFS piloting testwork tosupport refined nickel sulphate production undertaken by Metso Outotecin Finland.
Jervois remains confident in the attractiveness ofrestarting SMP, and that a larger, less staggered restart is thecorrect commercial approach given the Company’s increased scale andmarket presence following its acquisition of Freeport Cobalt (nowrebranded Jervois Finland).
SMP Refinery Closing Dateextension
Jervois currently holds a lease over SMP providing itaccess to undertake a BFS on a potential restart of the facility. Jervois has agreed with Companhia Brasileira de Alumínio(“ CBA ”) (an investee company of Votorantim) to extend theoutside date of closing of Jervois’ acquisition of SMP from 31December 2021 to 31 March 2022, however the R$1.5 million 1 monthly leasecharge will cease from the start of January 2022.
Closing of the SMP refinery acquisition by Jervois issubject to several conditions precedent, including renewal of the SãoPaulo City Hall operating permit. CBA is complying with necessarylegal procedures for renewal, and an updated license is expected to bereceived during 2021.
Jervois’ existing early termination option under thetransaction sale and purchase agreement will also be extended to 31December 2021.
The purchase price of R$125.0 million 2 payable in tranchesconditional upon permitting, restart BFS outcomes and futureproduction thresholds – with the exception of a R$15 million initialpayment which occurred in December 2020 – remains payable in stagesto June 2023. The next acquisition payment payable by Jervois willbe R$47.5 3 million cash onClosing.
On behalf of Jervois Global Limited,
Bryce Crocker, CEO
For further information, please contact:
Investors and analysts: James May Chief Financial Officer Jervois Global | Media: Nathan Ryan NWR Communications nathan.ryan@nwrcommunications.com.au Mob: +61 420 582 887 |
Forward-LookingStatements
This news release may containcertain “Forward-Looking Statements” within the meaning of theUnited States Private Securities Litigation Reform Act of 1995 andapplicable Canadian securities laws. When used in this news release,the words “anticipate”, “believe”, “estimate”,“expect”, “target, “plan”, “forecast”, “may”,“schedule”, “expected” and other similar words or expressionsidentify forward-looking statements or information. Theseforward-looking statements or information may relate to timing of theBFS at SMP refinery, timing of the receipt of operating permits andthe acquisition of SMP refinery and certain other factors orinformation. Such statements represent Jervois’ current views withrespect to future events and are necessarily based upon a number ofassumptions and estimates that, while considered reasonable byJervois, are inherently subject to significant business, economic,competitive, political and social risks, contingencies anduncertainties. Many factors, both known and unknown, could causeresults, performance or achievements to be materially different fromthe results, performance or achievements that are or may be expressedor implied by such forward-looking statements. Jervois does notintend, and does not assume any obligation, to update theseforward-looking statements or information to reflect changes inassumptions or changes in circumstances or any other events affectionssuch statements and information other than as required by applicablelaws, rules and regulations.
Neither TSX Venture Exchange nor itsRegulation Services Provider (as that term is defined in policies ofthe TSX Venture Exchange) accepts responsibility for the adequacy oraccuracy of this release.
1 Equivalent to US$0.28 million at current USD/BRL exchangerate of 5.35
2 Equivalent to US$23.4 million at current USD/BRL exchangerate of 5.35.
3 Equivalent to US$8.9 million at current USD/BRL exchangerate of 5.35.
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