FORTUNE MINERALS SECURES OPTION TO PURCHASE BROWNFIELD SITE IN ALBERTA’S INDUSTRIAL HEARTLAND FOR NICO REFINERY Former steel fabrication plant with buildings and facilities to materially reduce capital costs
January 24, 2022 Issued Capital: 374,091,544
NEWS RELEASE
FORTUNE MINERALS SECURES OPTION TO PURCHASE BROWNFIELD
SITE IN ALBERTA’S INDUSTRIAL HEARTLAND FOR NICO REFINERY
Former steel fabrication plant with buildings and facilities to materially reduce capital costs
LONDON, ONTARIO, Fortune Minerals Limited (TSX: FT) (OTCQB: FTMDF) (“Fortune” or the
“Company”) (www.fortuneminerals.com) is pleased to announce that it has entered into an option
agreement with JFSL Field Services ULC (“JFSL”), a wholly-owned subsidiary of a large international
engineering company, to purchase its former steel fabrication plant, located in Lamont County within
Alberta’s Industrial Heartland northeast of Edmonton. Pursuant to the agreement, Fortune will have six
months to carry out additional due-diligence and complete the purchase of the JFSL facility for C$5.5
million. Fortune intends to acquire this brownfield site in order to construct the hydrometallurgical
refinery for the planned NICO Cobalt-Gold-Bismuth-Copper mine in the Northwest Territories (“NWT”).
The proposed refinery would process concentrates from the mine and produce cobalt sulphate for the
rapidly expanding lithium-ion rechargeable battery industry and their use in electric vehicles (“EV’s”),
portable electronic devices, and stationary storage cells to make electricity use more efficient. In
addition to cobalt, the unique mineral assemblage of the NICO deposit includes a highly liquid 1.1 million
ounce in-situ gold co-product, 12% of global bismuth reserves, and copper. The vertically integrated
NICO development (“NICO Project”) would provide a reliable North American source of three Critical
Minerals produced responsibly with Canadian environmental-social governance (“ESG”) values that are
essential to support the transformation to new technologies and the growing green economy.
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"Cobalt, lithium and nickel are all minerals with huge demand in the modern world. Fortune’s new
refinery is exactly the type of job creating, diversifying investment we envisioned with our mineral
strategy and action plan.”
Jason Kenney, Premier of Alberta
“Fortune Minerals’ new facility will add to Alberta’s mineral refining capacity and will bring exciting
economic opportunities to the province. Alberta’s mineral strategy and action plan capitalizes on our
untapped potential and helps meet demand for the critical and rare earth minerals which are essential
to supporting a low-carbon economy. Fortune Minerals’ investment announcement demonstrates that
our strategy is working. Our province has the experienced workforce, and the necessary infrastructure
to support continued growth in the minerals sector, and there is no better place for a new Critical
Minerals refinery than Alberta’s Industrial Heartland.”
Sonya Savage, Minister of Energy, Government of Alberta
“I am pleased to see continued investment and diversification in the Industrial Heartland with Fortune
Minerals’ plan to establish a new cobalt refinery which will also have the future potential to recycle
FORTUNE MINERALS LIMITED
617 Wellington Street, London, Ontario, Canada N6A 3R6
Tel. 519-858-8188 ~ Fax. 519-858-8155
metals from post-consumer batteries from across Alberta. This project will create well-paid jobs for
Albertans and continued prosperity for my constituency.”
Jackie Armstrong-Homeniuk, MLA for Fort Saskatchewan-Vegreville
“The planned NICO Project in Alberta’s Industrial Heartland supports our region’s robust diversification
efforts and highlights our value proposition for companies looking to execute their capital growth
strategies, develop new technologies and advance their ESG priorities. Fortune Minerals’ innovative
vision and metallurgical process technology for the NICO Refinery will promote further energy supply
chain integration within North America, solidifying Alberta and Alberta’s Industrial Heartland as a critical
jurisdiction for Canada’s energy future.”
Mark Plamondon, Executive Director of Alberta’s Industrial Heartland Association
“More economic growth and diversification in Alberta’s energy and tech sectors shows our competitive
edge in action. This includes access to highly skilled labour, resources, and transportation links from
Alberta’s globally recognized Industrial Heartland and combined with our business-friendly environment
thanks to the Alberta tax advantage and a streamlined regulatory framework.”
Rick Christiaanse, CEO of Invest Alberta Corporation
Refinery Site
The JFSL facility is situated on 76.78 acres of land adjacent to the Canadian National Railway (“CN
Rail”) in Alberta’s Industrial Heartland, an association of five municipalities northeast of Edmonton with
planning approvals and tax incentives designed to attract heavy industry. This former steel fabrication
plant includes site improvements and more than 40,000 square feet of serviced shops and buildings
that are anticipated to materially reduce capital costs for the planned NICO Project development.
Key Site Attributes
- Brownfield location in the Edmonton area with geographic synergies to the NICO mine in the
NWT and existing facilities that can be integrated into the planned refinery
- Aligns with key Canadian and Alberta government policy objectives for western economic
diversification, value-added processing in Canada, and greater domestic participation in the
North American Critical Minerals supply chain for battery materials and EV’s
- Complements the Alberta Government Mineral Resource Development Act and the objectives
identified in the new minerals strategy and action plan
- Supports the Canada–U.S. Joint Action Plan on Critical Minerals Collaboration
- Lowest combined federal and provincial tax rate in Canada
- Indicative interest from federal and provincial governments for financial support
- Industrial Heartland planning approvals to attract heavy industry and municipal tax incentives
keyed to capital investment
- Access to CN Rail and intermodal transportation hubs to receive concentrate, reagents and
other plant feeds, to ship products, and facilitate future diversification into the recycling business
- Local services and utilities including power, natural gas, process and potable water, and a third
party-owned site to dispose of the process residue
- Proximity to primary reagent suppliers including lime and acid
- Commutable pool of engineers, trades and skilled labour to construct and operate the refinery
- Proximity to other Critical Minerals sources and process facilities to enable geographic vertical
integration of the Canadian battery materials supply chain and attract investment in downstream
industries
NICO Project
The NICO Project is comprised of a planned open pit and underground mine and mill in Canada’s NWT
and a related hydrometallurgical refinery in Alberta. Fortune has expended more than C$135 million to
advance the NICO Project from an in-house discovery to a near-term Critical Minerals producer. The
Company has received environmental assessment approval and the Type “A” Water License to
construct and operate the NICO mine and concentrator. The recent completion of the Tlicho highway
to the community of Whati is a key enabler for the NICO development. This C$213 million, 97-kilometre,
public, all-season road, together with the spur road Fortune plans to construct, will allow metal
concentrates to be trucked from the mine to the rail head at Hay River or Enterprise, NWT for railway
delivery to the Company’s planned refinery in Alberta. An important economic attribute of NICO ores is
a high concentration ratio from simple flotation, which allows the mill feed to be reduced to ~4% of the
original mass for lower cost transportation and downstream processing of a homogeneous sulphide
concentrate at the refinery.
The NICO Project was assessed in a positive Feasibility Study in 2014 by Micon International Limited
that demonstrated an attractive rate of return for the development. Key economic metrics at that time
were capital costs of ~C$600 million, including ~C$250 million for the refinery, annual revenues of
~C$200 million, C$100 million in EBITDA, 50% margins, and a negative cash cost for cobalt net of by-
product credits. These estimates will be updated to reflect current costs, escalation, and revised
commodity prices after completion of the refinery site purchase and incorporation of other project
optimizations that Fortune has recognized to produce a more financially robust project.
The NICO development is anticipated to have direct employment for 250 workers at the mine and an
additional 100 jobs at the refinery. Indirect jobs are expected to be double the direct jobs using a
standard 2:1 industry employment multiplier. The economic spinoffs for the refinery would be greater if
the refinery processes additional feed sources and recycled materials and/or the region attracts
investment from the battery and automotive industries.
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, who is a "Qualified Person" under National
Instrument 43-101.
Critical Minerals
The Canadian and United States governments have signed a Joint Action Plan on Critical Mineral
Collaboration to enable greater North American production of minerals identified as critical to economic
and national security. Minerals considered critical for this purpose have essential use in important
industrial and defense applications, cannot be easily substituted, and their supply chains are threatened
by geographic concentration of production and/or geopolitical risks. Cobalt is an ‘Energy Metal’ and
particularly important Critical Mineral due to its consumption in lithium-ion batteries. It is also consumed
in aerospace, magnet and cutting tool alloys, and pigments and catalysts needed in chemical
processes. The cobalt market is currently more than 150,000 tonnes of refined metal, although analysts
project that consumption will grow to between 300,000 and 400,000 tonnes by the end of this decade,
primarily due to demand from EV’s. More than 70% of cobalt mine production is currently sourced from
the Democratic Republic of the Congo, more than half of which is controlled by Chinese state-owned
corporations. China also controls 68% of refinery production and 80% of cobalt chemical supply.
Bismuth is also identified as a Critical Mineral with unique properties, including a low melting
temperature, high density and it expands when cooled, properties that are leveraged by the automotive
industry for glass frits, anti-corrosion coatings and metallic paints and pigments. Bismuth is also non-
toxic and has anti-bacterial properties making it ideal for use in pharmaceuticals such as Pepto-Bismol®
and some medical devices. The bismuth market is approximately 20,000 tonnes per annum, but has
growing demand as an ‘Eco-Metal’ and environmentally safe replacement for lead - in solder,
galvanizing and brass alloys, free-machining steel and aluminum, paint, glass, ceramic glazes,
cosmetics, solar voltaics, ammunition and fishing sinkers. Many of these applications have been
developed because of legislation banning or restricting the use of toxic metals including lead. China
controls approximately 75% of current bismuth mine and refinery production although the NICO deposit
contains the World’s largest known Mineral Reserve.
Additional North American production is needed to diversify the supply chains for both cobalt and
bismuth. Governments are therefore supporting potential near-term producers and processors to
ensure availability of the key raw materials needed to sustain domestic industries. Identification of the
new refinery site was one of the few remaining milestones needed to complete the NICO Project
development and solidify Fortune’s participation in the geographic vertical integration of the North
American battery materials supply chain.
About Fortune Minerals:
Fortune is a Canadian mining company focused on developing the NICO Cobalt-Gold-Bismuth-Copper
Project in the NWT 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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For further information please contact:
Fortune Minerals Limited
Troy Nazarewicz
Investor Relations Manager
Tel: (519) 858-8188
www.fortuneminerals.com
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 exercise of the option by the Company and the purchase of the JSFL site, the construction of the
proposed hydrometallurgical refinery at the JSFL site, the potential for expansion of the NICO Deposit and the
Company’s plans to develop the NICO Project. 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 successful
completion of the Company’s due diligence investigations on the JSFL site, the Company’s ability to secure the
necessary financing to fund the exercise of the option and complete the purchase of the JSFL site, the Company’s
ability to complete construction of a NICO Project refinery; the Company’s ability to arrange the necessary
financing to continue operations and develop the NICO Project; the receipt of all necessary regulatory approvals
for the construction and operation of the NICO Project and the related hydrometallurgical refinery and the timing
thereof; growth in the demand for cobalt; the time required to construct the NICO Project; 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 the 2021 drill program may not result in a meaningful expansion of the NICO Deposit, the
COVID-19 pandemic may interfere with the Company’s ability to conduct the drill program, the Company may not
be able to complete the purchase of the JSFL site and secure a site for the construction of a refinery, the Company
may not be able to finance and develop NICO on favourable terms or at all, 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.