The company has formed a strategic partnership with Pengxin International Mining Co.
Pengxin will invest $81 million in Clean TeQ via a private placement at an issue price of 88c per share, a 17% premium to the 20-day volume-weighted average price of shares.
It will give Pengxin a 16.2% stake in Clean TeQ, with chairman Jiang Zhaobai to be appointed as co-chairman alongside Robert Friedland.
Current co-chairman Sam Riggall and CEO will become managing director.
Zhaobai described the Syerston project as strategically important as the energy storage market continued to grow rapidly.
Friedland said the broader Pengxin Group was a well-respected conglomerate in China.
“Having access to Pengxin Group’s extensive global networks provides the company with significantly enhanced financial, commercial and technical opportunities,” he said.
“The placement proceeds will provide Clean TeQ with the funding to maintain a fast-track schedule for the development of the Syerston project.”
Pengxin will assist with financing and offtake activities.
Clean TeQ is currently completing the definitive feasibility study for Syerston, as well as an optimisation study in parallel.
In August, the company completed a feasibility study on a standalone scandium operation at Syerston, but also completed a prefeasibility study into a large scale nickel-cobalt development, where scandium would be a by-product.
Capital costs were estimated at $US680 million for a 2.5 million tonne per annum operation for an initial 20-year operation, with existing reserves available for up to an additional 19 years of life.
The PFS generated a post-tax net present value of $891 million, at an 8% discount rate, and an internal rate of return of 25%, assuming metal prices of $7.50/lb nickel and $12/lb cobalt.
Including a scandium oxide by-product increases the NPV to $1.2 billion and the IRR to 30%.
The company said the Pengxin funds would allow it to move the project into the implementation phase in the second half of the year, ahead of the completion of the DFS, scheduled for the end of the year.
A resin-in-pulp pilot campaign at ALS Metallurgy in Perth successfully processed a 20 tonne bulk sample to produce a batch of high-purity nickel and cobalt sulphate eluate solution.
The solution is currently being refined into samples of high-purity nickel sulphate and cobalt sulphate.
That will be sent to potential customers this month for testing.
Friedland owns 19.35% of Clean TeQ after making an initial investment in 2013.
It was Friedland’s Ivanhoe Mines that sold Clean TeQ the Syerston project in 2014.
Clean TeQ shares hit an all-time high of $A1.02 this morning, but last traded 6.8% higher at 94c – more than double since the start of January.
