Mining entrepreneur Robert Friedland said on Monday that dual-listed Clean TeQ would be patient with the development of the Sunrise battery material project, in New South Wales, and that it would seek to develop the project with partners that understood the value of a responsible supply chain.

Commenting on the completion of a project execution plan (PEP) for Sunrise, Friedland said automotive supply chains were coming to realise that they were playing a game of nickel and cobalt musical chairs.

“We are halfway through the second verse and the music will eventually stop,” he said.

“We cannot anticipate how long it will take to have the project funded and in development, but we can be patient with such a strategically important asset, and we are fully committed to ensuring it is developed with partners who understand the value that responsible supply chain integration brings.”

The PEP confirmed Sunrise’s potential as a major supplier of nickel and cobalt to the lithium-ion battery market and scandium to the aerospace, consumer electronics and automotive sectors. For the automotive sector, the Sunrise refinery would produce enough high-quality nickel to support the production of up to one-million electric vehicles (EVs) a year, with cobalt production sufficient to support up to two-million EVs a year, the company stated.

“We have a clear vision for how to create a sustainable auto supply chain of the future,” said Friedland.

The PEP modelled the first 25 years of production, with sufficient ore reserves to extend operations up to about 50 years.

On average, Sunrise would produce 21 293 t/y of nickel and 4 366 t/y of cobalt in the first 11 years and 18 439 t/y of nickel and 3 179 t/y of cobalt over its 25-year life.

High cobalt credits result in average C1 operating costs of negative $1.97/lb of nickel after byproduct credits.

The PEP calculated an aftertax net present value of $1.2-billion and an internal rate of return of 15.44%. The preproduction capital cost estimate is $1.66-billion and Clean TeQ stated that about 79% of total equipment and material costs were covered by vendor quotations.

Future optimisation studies would assess opportunities to reduce capital expenditure.