ASX-listed aspiring Vietnam nickel developer Blackstone Minerals has engaged the Korea Development Bank and corporate adviser BurnVoir Corporate Finance to jointly pull together a debt funding package for the proposed development of its Ta Khoa nickel project about 160 kilometres west of Hanoi. Perth-based Blackstone is currently contemplating a potentially “vertically integrated” upstream and downstream lithium-ion battery metals processing operation at Ta Khoa in northern Vietnam.
According to various financial studies the company has carried out to date, estimated pre-production capital costs for the mine and downstream refinery come in at about US$314 million and US$491 million respectively, for a total of just over US$800 million.
Blackstone says BurnVoir has arranged financing for several battery metals projects in recent years, including for Pilbara Minerals in relation to its Pilgangoora lithium project in Western Australia and a $1.1 billion debt facility for IGO’s recent acquisition of an interest in the Greenbushes lithium mine and the Kwinana lithium hydroxide refinery in WA.
The 67-year-old state-owned Korea Development Bank also has strong relationships with a wealth of major global project finance institutions, Blackstone says.
Blackstone Minerals Managing Director Scott Williamson said: “Korea Development Bank and BurnVoir bring their respective strengths across the lithium-ion battery value chain, including strong relationships with potential customers of the Ta Khoa downstream refinery. Both Korea Development Bank and BurnVoir have extensive experience in arranging development funding for quality projects, and their involvement in the Ta Khoa project is an endorsement of Blackstone’s strategy and ability to execute.”
Blackstone delivered an impressive looking pre-feasibility study a month ago on the proposed hydrometallurgical refinery that will upgrade nickel sulphide concentrates, partially from its own proposed mine, to ultimately produce battery-grade nickel-cobalt-manganese precursor products for use in the manufacture of lithium-ion batteries.
Base-case annual after-tax free cash flows have been forecast in the study to average a stonking US$365 million a year across an initial operations life at the downstream refinery of 10 years.
The headline financials are predicated on the processing of 400,000 tonnes of nickel concentrate per annum by the Ta Khoa refinery and production of 85,600 tonnes of nickel-cobalt-manganese precursor products per annum and 43,500 tonnes of refined nickel output per annum.
The capital payback period has been put at just one-and-a-half years.
Blackstone hopes to make a final investment decision on the downstream development proposition next year after completion of a definitive feasibility study.
The company is now gearing up to kick off the definitive feasibility study shortly that will include pilot plant testing of the processing of nickel concentrate feed.
Blackstone envisages concentrate supply for the Ta Khoa refinery being sourced roughly 50:50 from its proposed Ta Khoa nickel-copper-PGE mine and third parties.
A pre-feasibility study on the proposed development of the mining and concentrator operation or “upstream business unit” is in progress.
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By Matt Birney
