Australian Mines signs long-form off-take agreement with SK Innovation for Sconi Project
Advanced battery materials developer Australian Mines (ASX: AUZ) advises that Australian Mines and SK Innovation have executed a long-form off-take agreement that replaces and expands upon the agreed terms of the binding term sheet executed by Australian Mines and SK Innovation and announced by the Company in February 2018.
As foreshadowed in the Company’s announcements in January 2019 and February 2019, under the Agreement, SK Innovation has agreed, subject to the satisfaction of certain conditions precedent, to purchase 100% of the battery-grade cobalt sulphate and nickel sulphate produced from Australian Mines’ wholly-owned Sconi Cobalt-Nickel-Scandium Project in North Queensland for an initial seven-year period (which may be extended by mutual agreement for up to a further six years).
A summary of the key terms of the Agreement, including the conditions precedent, are set out in the link below.
Sales prices under the Agreement are linked to the corresponding London Metal Exchange nickel price and Metal Bulletin cobalt price.
Due to SK Innovation not having exercised its subscription or investment option, the final long-form off-take agreement does not contain a buyer discount on the base price of cobalt and nickel production from the Sconi Project.