Canada Nickel Eyes $500M Loan for World’s Largest Nickel-Cobalt Sulphide Project
Canada Nickel has announced that Export Development Canada (EDC) may provide a $500 million loan for its Crawford project in northern Ontario, which is poised to become the world’s largest nickel-cobalt sulphide development. This potential funding, combined with $600 million in tax credits from the Canadian government, would support the construction of the C$3.5 billion project, set to proceed in two phases.
The EDC's letter of intent, received in late August, marks a significant step toward securing the full financing package needed for the Crawford project. According to CEO Mark Selby, the company is working with financial advisers Deutsche Bank, Scotiabank, and Cutfield Freeman to secure the remaining funding required to begin construction, expected in mid-2025 once permits are received.
Shares of Canada Nickel rose 6% following the news, with its stock trading at C$1.05 on Friday, valuing the company at C$190.3 million. The stock has ranged between C$0.89 and C$2.24 over the past 52 weeks.
Canada Nickel has attracted major backers, including Agnico Eagle Mines, which invested C$23.1 million for a 12% stake, and Anglo American, which acquired a 9.9% stake for C$24 million. South Korean battery manufacturer Samsung SDI also holds 8.7% of Canada Nickel, with potential offtake agreements after investing $18.5 million.
The Crawford project, expected to start production in 2027, boasts a significant resource of 2.5 billion tonnes grading 0.24% nickel, amounting to 13.3 billion pounds of contained metal. The project’s feasibility study, published last October, estimates an after-tax net present value of $2.6 billion and an internal rate of return of 18.3%. Canada Nickel plans to build two plants, costing over C$1 billion, to process the nickel into stainless steel and alloys.
Despite the positive long-term outlook for nickel demand due to electric vehicle production, the sector has faced challenges in recent years as nickel and lithium prices have slumped, causing delays and suspensions for some mining projects.
