Canada Nickel Reports Successful Carbon Storage Pilot and Outlines Significant Revenue Opportunity

Canada Nickel Company Inc. (TSXV:CNC) (OTCQX:CNIKF) announced that it has successfully completed its carbon storage pilot plant, demonstrating the value of its novel carbon storage process, In-Process Tailings (“IPT”) Carbonation.

Source: Skarn Associates Q2-2022

Press Release Highlights

  • Carbon storage pilot plant confirms the prior feasibility study design parameters, proving the Crawford Nickel mine will be potentially the lowest emmission source of nickel in the world.
  • Expected to generate $25/ton of storage fee revenue with initial capacity to store 1 million tons a year, generating $25 million of incremental, high margin revenue for the company.
  • Company can now qualify for over C$100 million of government grants to fund initial startup capex of US$1.2 Billion, potentially avoiding any equity funding requirements (new shares) to bring the project online. 
  • IPT Carbonation worked on third party tailings as well, confirming the technologies’ commercialization potential.
  • Canada Nickel estimates 20mtpa of storage demand vs its ability to store 1mtpa initially, meaning there is potential to ramp up storage revenue as Crawford production expands.

Additional Test Details

The Company processed more than 7 tonnes of tailings and confirmed the engineering design parameters for IPT Carbonation for incorporation in the Integrated Feasibility Study (“IFS”) expected to be released on October 12, 2023. The pilot plant also was utilized to successfully apply the IPT Carbonation process to material from a third party’s project, demonstrating the potential to commercialize the process for other projects including the Company’s regional nickel properties in the Timmins Nickel District.

In addition, a study by a leading strategy house confirms that the Canada Nickel Crawford project could reasonably expect in excess of C$25 per tonne of CO2 in storage fees from its IPT Carbonation process based on publicly known storage fees and given communicated carbon price & policy status. The study also confirmed the potential requirement for more than 20 million tonnes of annual storage capacity of CO2, given communicated carbon price & CCUS ITC status, from a population of approximately 150 potential emitters, with approximately 50 emitters concentrated in four distinct clusters in Sudbury, Sault
Ste. Marie, Toronto and Sarnia.

Our successful pilot plant results, coupled with this study, confirm the significant value potential of the Company’s IPT Carbonation process. The potential demand for more than 20 million tonnes annually of CO2 storage is well in excess of the 1 million tonne capacity for Crawford, which supports our Company’s belief that our Timmins Nickel District can anchor a Zero Carbon Industrial Cluster in the Timmins-Cochrane region. The work also supports our belief that the Crawford project can qualify a portion of its capital expenditures to take advantage of the Carbon Capture and Storage refundable tax credits announced by the federal government in its 2022 budget.
We look forward to the release of our Feasibility Study on October 12th, which we expect to support our belief that Crawford is poised to be a leader in the energy transition through the large-scale production of critical minerals, including nickel and cobalt, and to become the sole North American producer of chromium, while also supporting Canada’s climate objectives through large scale carbon capture and storage.Mark Selby, CEO, Canada Nickel

IPT Carbonation Process

Canada Nickel’s Crawford Project is hosted in ultramafic rock, which naturally absorbs and sequesters CO2. Canada Nickel has developed the novel IPT Carbonation process which involves injecting a concentrated source of CO2 into tailings generated by the milling process for a brief period of time. This simple process captures CO2 geologically in the tailings while they are still in the processing circuit, rather than after they
have been finally deposited.

Carbon Capture, Utilization Storage and Tax Credit

The Company believes that the successful incorporation of IPT Carbonation could potentially allow a portion of the Company’s project capital expenditures to become eligible for the carbon capture and storage refundable investment tax credits of 37.5% to 60% for years 2022-2030 and 18.75% to 30% for years 2031-2040, as announced in the 2022 federal budget. The interest received from multiple large multinational companies pursuing carbon storage solutions further supports the Company’s belief that the mineral sequestration utilized by the Company may be considered an effective carbon storage
approach that would meet Environment and Climate Change Canada requirements.

Feasibility Study Conference Call

Canada Nickel will be hosting a webcast and conference call on Thursday, October 12, 2023 at 11:00 a.m. Eastern Time to discuss the Feasibility Study.

Conference Call Details:

Date: Thursday, October 12, 2023
Time: 11:00 a.m. ET
Participants may join the webcast and call as follows:
Audience URL:
Dialing local Toronto: 416-764-8688
Dialing North American Toll Free: 888-390-0546
Dialing International Toll Free:
Australia: 1800076068
Germany: 08007240293
Switzerland: 0800312635
South Africa: 0800994942
UK (England): 448006522435

For those unable to participate, a web-based archive of the conference call will be available for playback at the same Audience URL used to access the live webcast.

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.


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