Australian mineral explorer Centaurus Metals has signed an agreement with Vale Base Metals to acquire offtake rights for its Jaguar nickel sulphide mining project in northern Brazil.
The offtake rights originate from Centaurus’ 100% acquisition of the Jaguar project from Vale in April 2020.
Vale will now waive its rights in lieu of raising its net operating royalty over the project by 1.2% for nickel sulphate, as well as 1.25% for nickel concentrate and other products produced at the Jaguar project.
The increase is expected to compensate Vale for its earlier contractual rights under the acquisition deal.
It will also allow Centaurus to explore funding and offtake options from several potential end users of nickel sulphate product.
According to Centaurus, there is a rising demand for offtakes for battery raw materials from original equipment manufacturers (OEMs), battery manufacturers and others.
This interest is expected to bring a wide variety of new funding opportunities for the project.
The company further said that there have been several groups that have shown interest in securing physical offtake of nickel with a low carbon footprint and strong environmental, social and governance credentials for the project.
The latest agreement is expected to help the company exert full control and optionality on the sale of nickel sulphate from the project.
Centaurus managing director Darren Gordon said: “We anticipate that our low-greenhouse gas emission nickel sulphate product will be highly sought after in the global market, particularly amongst end users, with Centaurus now able to freely explore a range of strategic funding and offtake options to support the project’s development.
“The battery materials market is expanding exponentially, and we are increasingly seeing OEMs and other EV battery players moving further upstream as they seek to secure long-term supplies of key raw materials.”
