PERTH (miningweekly.com) – The Queensland government has offered ASX-listed Australian Mines a conditional financial support package for the development of its Sconi cobalt/nickel/scandium project.

The support package will be funded from the government’s A$175-million Jobs and Regional Growth Fund and will be subject to a number of conditions. Assistance from the Jobs and Regional Growth Fund will contribute toward two stages of the project’s development, from preliminary works through to, and including, establishment of the mine and processing infrastructure works.

The funding would be dependent on Australian Mines securing an offtake agreement by the end of September for all of the nickel sulphate and cobalt sulphate to be produced at Sconi.

The funding would also be subject to the delivery of a detailed execution plan, obtaining sufficient approved financing for the construction of the project and making a final investment decision before the end of 2020, appointing an engineering, procurement and construction management contractor by the end of the year, and achieving construction completion by the end of July 2023.

Furthermore, the funding would also be subject to Australian Mines employing at least 191 people in Queensland on a full time basis by June 2024, maintaining that number for the duration of the agreement, and engaging at least 57 full time independent contractors working directly on the Sconi project.

The A$1.5-billion two-million-tonne-a-year Sconi project will produce some 7 000 t/y of cobalt sulphate and 46 800 t/y of nickel sulphate over a mine life of 30 years.

Minister for Regional Development and Manufacturing Glenn Butcher said minerals from the Sconi mine could go to powering the next generation of electric vehicles or be used in our high-value aerospace sector.

“This project has the potential to support the regional economy and hundreds of jobs. That’s why the government is proud to support the project as part of Queensland’s plan for economic recovery.”

Australian Mines MD Benjamin Bell said the company was highly appreciative of the government’s offer to broaden its ongoing support for the Sconi project.

“Having the opportunity to access state funding for Sconi sends a strong message about the quality of the project and Australian Mines’ ability to progress its development, despite the broader economic uncertainty being caused by the Covid-19 pandemic.

“Australian Mines takes the view this financial support package is evidence the Queensland government is not letting up on doing the hard work to create jobs and promote economic growth across the state by offering every assistance they can to projects like Sconi. We also believe the timetable and terms are aligned with Australian Mines’ expectations for the development of Sconi at this stage.”

Bell said the company was making good progress to secure the offtake and financing agreements needed to access the funding.