Fortune Minerals Limited (TSX: FT) (OTCQB: FTMDF) (“Fortune” or the “Company”) (www.fortuneminerals.com) is pleased to announce that it has secured additional funding from the Government of Canada to help advance the Company’s 100%-owned, vertically integrated NICO cobalt-gold-bismuth-copper Critical Minerals asset in Canada (“NICO Project”). The Government of Canada has agreed to provide contribution funding for up to C$7.5 million to support 75% of the costs for additional engineering and test work, totalling approximately C$10 million through the Global Partnerships Initiative (“GPI”). Natural Resources Canada (“NRCan”) is the funding department for the GPI and Fortune will provide additional due-diligence information and complete a Contribution Agreement over the next few weeks. The objectives of the work being funded by NRCan are to build on and complement the programs being supported by the U.S. Department of Defense (“DoD”) through the Company’s Defense Production Act (“DPA”) Title III award for US$6,380,555 (~C$8.74 million) (see the news releases also dated May 16, 2024). The total amount of non-dilutive funding that Fortune expects to receive from the U.S. and Canadian governments is approximately C$16.2 million. This important cross-border initiative is aligned with the Canada – U.S. Joint Action Plan on Critical Minerals Collaboration to strengthen North American production of the metals needed in essential industries and new technologies to support the energy transition and the growing green economy.
The NICO Project is an advanced development stage Critical Minerals asset comprised of a planned open pit and underground mine and concentrator in the Northwest Territories (“NWT”) and a related hydrometallurgical refinery in Alberta (the “Alberta Refinery”). The Alberta Refinery would process concentrates from the NICO mine and other materials to produce cobalt sulphate, gold doré, bismuth ingots and copper. The previously announced collaboration between Fortune and Rio Tinto is assessing the feasibility of blending intermediate products produced from Kennecott smelter wastes in Utah with NICO Project process streams to augment cobalt and bismuth production (see news release, dated April 8, 2023). Development of the NICO Project would provide a vertically integrated domestic supply of three Critical Minerals and gold, produced with North American supply chain transparency, reliability, and Environmental Social Governance (“ESG”) standards, and compliance with the U.S. Inflation Reduction Act (“IRA”) to mitigate supply chain risks.
The GPI will support, enhance and promote Canada’s international leadership in Critical Minerals, in collaboration with international partners. The NRCan funding contribution would be used to address three NICO Project tasks:
1) An expanded test work program to assess feed source variability and blending of Rio Tinto sourced intermediate materials with NICO Project process streams;
2) A Feasibility Study sensitivity analysis of the engineering and economic impacts of blending Rio Tinto feed sources into the planned Alberta Refinery;
3) A Front-End Engineering and Design (“FEED”) Study for the NICO Project, providing more detailed engineering to build on the DoD funded updated Feasibility Study and enable equipment procurement and greater cost certainty.
“Today’s investment in Fortune Minerals Limited will help advance supply chain resilience and create job opportunities in Canada – all part of our work to build a prosperous and sustainable Canadian economy that benefits everyone. We will continue to work with allies and industry to ensure the development of secure resources for a prosperous net-zero future.” The Honourable Jonathan Wilkinson, Minister of Energy and Natural Resources.
Robin Goad, President and CEO of Fortune Minerals Limited commented, “the demand for Critical Minerals needed for the energy transition requires new vertically integrated domestic production from non-traditional ores and concentrates. Bi-lateral Canadian and U.S. government investment is therefore important to align mineral production with changes in new technologies, ensure security of supply, and support North American industrial competitiveness.”
Fortune’s goal is to deliver vertically integrated production facilities to become a reliable producer of cobalt for the rapidly expanding North American lithium-ion rechargeable battery industry. As a domestic source, NICO Project cobalt would be compliant with the terms of the IRA and help qualify U.S. customers of North American built electric vehicles for tax credits supporting the transition to e-mobility. With 12% of global bismuth reserves, the NICO Project would provide a domestic alternative for products used in the automotive and pharmaceutical industries. It would provide a non-toxic and environmentally safe replacement for lead to eliminate toxicity in the alloys used for potable drinking water sources, free-machining steels and aluminum, radiation shielding, and ammunition as well as bismuth compounds used in glass, ceramic glazes, paints, and cosmetics. Bismuth consumption is also growing in environmentally safe plugs to properly seal decommissioned oil and gas wells and prevent greenhouse gas leakage as well as manganese-bismuth magnets for use in electric vehicle powertrain motors. The NICO deposit also contains more than one million ounces of gold as a highly liquid and countercyclical co-product to mitigate Critical Mineral price volatility, plus minor copper, and a potential gypsum by-product to reduce process residue disposal costs.
