Scandium International Mining Corp. [SCY-TSX; SCYYF-OTC] said it has been notified that its mine lease grant for the Nyngan scandium project in Australia is currently invalid. The company said it received this information from the New South Wales Department of Planning and Environment.
Scandium said it is actively engaged in various continuing actions to resolve the current impasse with the landowner and department.
However, the company said it believes it can permit and construct a scandium mine, of similar design and scale to its current plans, without the requirement by Scandium International’s Australian subsidiary to own or control surface rights that are the subject of this current landholder objection.
It also said several resolution pathways are now clearly identified, and the parties are engaged in actions that could make meaningful advancements, or fully resolve the impasse.
In addition, the company said it fully intends to proceed with development of the Nyngan scandium project, regardless of the outcome of the pending landowner objection to the development covering a portion of the project resource.
The Nyngan Project and is located 500 km northwest of Sydney, 25 km west of the town of Nyngan, and is 100%-owned by Scandium International and its Australian subsidiary, EMC Metals Australia Pty. Ltd.
Outside existing by-product production in Russia and China, the Nyngan Project is the most advanced scandium development opportunity globally, with initial off-take contracts in place, the company has said. Nyngan is expected to be the world’s first scandium-only mine development project.
In May 2018, Cobalt 27 Capital Corp. [KBLT-TSXV; 270-FSE] agreed to acquire a 1.7% gross revenue royalty on the fully-permitted and construction-ready Nyngan scandium project.
Scandium is a soft, silver metallic element. It can be applied across the high end range of existing aluminum alloys to produce significant performance gains. For example, adding scandium to aluminum adds considerable strength, retains weldability, and preserves notch strength and corrosion resistance in alloys.
Because of those attributes [adding strength and saving weight], global aerospace is expected to be the biggest demand driver
The Nyngan Project has a current NI 43-101-compliant measured and indicated scandium resource of 16.9 million tonnes at 235 ppm Sc. A project reserve of 1.43 million tonnes, grading 409 ppm Sc was established on part of the resource, according to an April 2016 press release, which contains results of a feasibility study.
According to the feasibility study results, the capital cost estimate for the project is US$87.1 million. Oxide product volume averages are anticipated at 37,690 kg per year, over a 20-year life span.
Publicly offered prices for high-grade scandium oxide range from $3,000 to over $5,000 per kilogram, according to the company. Actual prices depend on quantity, source and purity of the product. In February 2018, the U.S. declared that scandium is on a draft list of 35 mineral commodities deemed critical under the definition of an Executive Order released by the U.S. Department of the Interior. It is estimated that only 15 tonnes of scandium are produced globally each year.
On Monday, Scandium International shares eased 3.4% or $0.005 to 14 cents. The shares trade in a 52-week range of 11 cents and 32 cents.