Canada Nickel (TSXV:CNC) - Nickel Mega-District Opens up US Markets

Company Interviews

Interview with Mark Selby, CEO of Canada Nickel.

Our previous interview: https://www.cruxinvestor.com/posts/canada-nickel-tsxvcnc-advancing-a-world-class-nickel-sulfide-project-5048

Recording date: 16th May 2024

Canada Nickel is advancing the Crawford nickel sulfide project, which is already the world's second largest nickel sulfide resource and reserve. They are also unlocking the potential of the Timmins nickel district in Ontario, Canada which could become the world's largest nickel sulfide district.

With $35 million in funding secured in early 2024, Canada Nickel is executing on plans to grow the resource. Recent drilling at their Reid property suggests it has potential for a much larger, lower-strip ratio resource than their flagship Crawford deposit. Over the next 12 months, the company aims to publish 7 additional resources (totalling 8, including Crawford) with the potential for 6 additional discoveries in the district.

Preliminary metallurgical testing at two other properties (Reid and MacDiarmid) using the same flowsheet as Crawford achieved the targeted 58-59% nickel recoveries and concentrate grades. This suggests the company can replicate the Crawford process at other deposits. From initial resource to full feasibility study at Crawford, it took just over three years—this timeline could be reduced for their other projects.

Canada Nickel expects to have the Crawford project fully permitted and financed by the end of 2024. A feasibility study showed a robust 18% after-tax IRR for Crawford inclusive of carbon capture credits. Although the nickel grade is relatively low, the scale (40+ year mine life), location and existing infrastructure make it highly economic. The after-tax NPV was US$2.5B (C$3.5B) compared to the company's C$250M market cap.

Anglo American, Glencore and Samsung SDI are cornerstone investors in Canada Nickel, validating the company and project. Canada Nickel is partnered with Ausenco, who have a strong track record of delivering base metal projects on time and budget, significantly de-risking the project.

The Timmins region has significant infrastructure advantages (skilled labor, low-carbon grid power, highway and rail access) that enable development of large, lower-grade nickel deposits. Selby believes the district could produce the equivalent of 5 Crawford-sized mines over the next 10-15 years to meet the explosive growth in nickel demand from EVs.

With the U.S. and Europe looking to secure domestic critical mineral supply chains and reduce reliance on China and Indonesia, Selby sees bifurcation of the nickel market, with consumers demanding "green" nickel. Canada Nickel is well positioned to help fill the supply gap for clean, ethical nickel in the coming years.

The nickel price has performed well, reaching near $20,000/t - Selby sees potential for further gains as most analysts are underestimating demand growth which has been over 10% annually so far this decade.

In summary, Canada Nickel offers compelling exposure to rising nickel demand, with a large, scalable and well-located nickel sulfide resource in a Tier 1 jurisdiction. Near-term catalysts include financing/permitting of Crawford, resource growth, and new discoveries.

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Learn more: https://cruxinvestor.com/companies/canada-nickel

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