Australia’s Ardea Resources is poised to lock in a strategic partner and play a key role in the electrification of the global economy.
Holding the largest nickel-cobalt resource in Australia, and one of the largest in the world, Ardea says it could put 147 million electric cars on the world’s roads.
Chief executive Andrew Penkethman tells AAP there’s a sense that things were good for critical minerals under the prior federal government and will be more so under Labor.
Ardea’s Kalgoorlie nickel project, 70km north of the Western Australian town and closer to rail and ports than rival newcomer NiCo Resources in central Australia, was granted major project status in March by the coalition government.
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
Mr Penkethman is already on good terms with the new Albanese administration, which has set a stricter national emissions reduction target that will need an accelerated exit of fossil fuels across heavy industry and the electricity grid.
He had a seat at the table at the recent critical minerals summit in Sydney with federal Resources Minister Madeleine King and US Energy Secretary Jennifer Granholm.
“I’ve been really impressed by the level of engagement, both before the change of government and similarly after,” he says on the sidelines of the Diggers and Dealers Mining Forum in Kalgoorlie.
Securing the prized status was two years in the making, working through a maze of government departments, and has opened the door to the nation’s experts as well as potential investment partners.
“Since it was granted major project status, it’s like the floodgates have opened. The support’s been phenomenal,” he says.
“There’s a specific strategic partner showing interest and we can contact the relevant people in Treasury and say how would the government perceive company X?”
Historically, nickel has been used in stainless steel but is now crucial for advanced defence industries as well as clean energy technologies.
He says a lot of the hard work has been done, drilling and confirming the resource.
But the company is in no rush to lock in offtake agreements for future supply that other critical minerals firms have been striking this year with the world’s major carmakers, including Tesla and Ford.
“That’s quite a deliberate strategy,” he says.
Ardea is following a different path, aware that the US, Europe, South Korea and Japan are playing catch-up with China, which dominates the lithium-ion battery sector as first mover.
“In my opinion, others have gone too early.”
He says offtake agreements struck now could be “value destructive” for shareholders.
“It’s our belief the longer we retain the offtake, the more value we can add to the project and the more desperate all the lithium-ion battery plays will become.”
Ardea also aspires to be one of the lowest-polluting nickel producers globally, pitching itself as a source of “sustainable and ethical critical minerals” needed by economies slashing carbon emissions to fight climate change.
“We generate all of our own power off grid, completely independent of fossil fuels,” Mr Penkethman says.
“Our emissions are in line with BHP Nickel West that promote themselves as one of the lowest carbon emission nickel producers in the world.”