Fortune Minerals Announces Government of Canada Funding for the NICO Critical Minerals Project Government of Canada funding for additional engineering and test work to build on and complement activities being supported by the U.S. Department of Defense
Fortune Minerals Announces Government of Canada Funding for the NICO
Critical Minerals Project
Government of Canada funding for additional engineering and test work to build on and
complement activities being supported by the U.S. Department of Defense
LONDON, Ontario--(BUSINESS WIRE)--May 16, 2024--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.
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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.
The NICO Project is a development stage Critical Minerals asset that Fortune has already
expended more than C$137 million to advance from an in-house mineral discovery to a near
shovel-ready project with a positive Feasibility Study in 2014 (that will be updated in 2024), and
environmental assessment approval and the major mine permits for the facilities in the NWT.
For more detailed information about the NICO Mineral Reserves and certain technical
information in this news release, please refer to the Technical Report on the NICO Project,
entitled "Technical Report on the Feasibility Study for the NICO-Gold-Cobalt-Bismuth-Copper
Project, Northwest Territories, Canada", dated April 2, 2014 and prepared by Micon
International Limited which has been filed on SEDAR and is available under the Company's
profile at www.sedar.com. The disclosure of scientific and technical information contained in
this news release has been approved by Robin Goad, M.Sc., P.Geo., President and Chief
Executive Officer of Fortune and Alex Mezei, P.Eng. Consulting Metallurgist, who are
"Qualified Persons" under National Instrument 43-101.
About Fortune Minerals:
Fortune is a Canadian mining company focused on developing the NICO cobalt-gold-bismuth-
copper Critical Minerals project in the Northwest Territories and Alberta. Fortune also owns the
satellite Sue-Dianne copper-silver-gold deposit located 25 km north of the NICO Deposit and is
a potential future source of incremental mill feed to extend the life of the NICO mill and
concentrator.
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This press release contains forward-looking information and forward-looking statements within
the meaning of applicable securities legislation. This forward-looking information includes
statements with respect to, among other things, the use of the Government of Canada and DOD
funds, advancement of the NICO Project towards a project finance decision, including the
successful construction and completion of the Company’s proposed hydrometallurgical refinery
and the successful development and construction of the planned NICO cobalt-gold-bismuth-
copper mine and concentrator NICO Project becoming a reliable source of cobalt, sulphate,
gold, bismuth and copper, NICO Project providing a source of battery materials that would be
compliant with IRA and allow tax credits, and NICO Project’s projected average annual
production of cobalt, gold, bismuth and copper. Forward-looking information is based on the
opinions and estimates of management as well as certain assumptions at the date the information
is given (including, in respect of the forward-looking information contained in this press release,
assumptions regarding: the actual receipt of funds from the Government of Canada and DOD,
the Company’s ability to complete construction of NICO Project mine, concentrator, the
hydrometallurgical refinery and advance the NICO Project; the Company’s ability to arrange
the necessary financing beyond the Government of Canada and DOD funding to continue
operations and develop the NICO Project; the receipt of all necessary regulatory approvals for
the construction and operation of the NICO Project, including the planned NICO cobalt-gold-
bismuth-copper mine and concentrator and hydrometallurgical refinery and the timing thereof;
growth in the demand for cobalt; the time required to construct the NICO Project; the relevant
laws and regulations in Canada and the U.S.; and the economic environment in which the
Company will operate in the future, including the price of gold, cobalt and other by-product
metals, anticipated costs and the volumes of metals to be produced at the NICO Project).
However, such forward-looking information is subject to a variety of risks and uncertainties and
other factors that could cause actual events or results to differ materially from those projected in
the forward-looking information. These factors include the risks that global geopolitical
situations may interfere with the Company’s ability to continue development of the NICO
Project, the Company may not be able to finance and develop NICO on favourable terms or at
all, relevant regulatory changes, uncertainties with respect to the receipt or timing of required
permits, approvals and agreements for the development of the NICO Project, including the
related hydrometallurgical refinery, the construction of the NICO Project may take longer than
anticipated, the Company may not be able to secure offtake agreements for the metals to be
produced at the NICO Project, the Sue-Dianne Property may not be developed to the point
where it can provide mill feed to the NICO Project, the inherent risks involved in the exploration
and development of mineral properties and in the mining industry in general, the market for
products that use cobalt or bismuth may not grow to the extent anticipated, the future supply of
cobalt and bismuth may not be as limited as anticipated, the risk of decreases in the market
prices of cobalt, bismuth and other metals to be produced by the NICO Project, discrepancies
between actual and estimated Mineral Resources or between actual and estimated metallurgical
recoveries, uncertainties associated with estimating Mineral Resources and Reserves and the
risk that even if such Mineral Resources prove accurate the risk that such Mineral Resources
may not be converted into Mineral Reserves once economic conditions are applied, the
Company’s production of cobalt, bismuth and other metals may be less than anticipated and
other operational and development risks, market risks and regulatory risks. Readers are
cautioned to not place undue reliance on forward-looking information because it is possible that
predictions, forecasts, projections, and other forms of forward-looking information will not be
achieved by the Company. The forward-looking information contained herein is made as of the
date hereof and the Company assumes no responsibility to update or revise it to reflect new
events or circumstances, except as required by law.
Contacts
Fortune Minerals Limited
Troy Nazarewicz
Investor Relations Manager
Tel: (519) 858-8188
www.fortuneminerals.com