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- Australian Mines has dropped its seven-year Off-take Agreement with SK Innovations
- SK Innovations agreed to purchase 100 per cent of the battery-grade cobalt sulphate and nickel sulphate that is produced at the Sconi Project in Queensland
- Australian Mines says that SK Innovations did not issue an agreed pre-payment or finance letter to the company by the due date
- Australian Mines is down 25.93 per cent on the market this morning and is trading at 2¢ per share
Australian Mines has terminated its Offtake Agreement with SK Innovations at its Sconi Project.
In August, the company signed a seven year agreement with the South Korean company.
Under the original agreement, SK Innovations agreed to purchase 100 per cent of the battery- grade cobalt sulphate and nickel sulphate that is produced at the Sconi Project in Queensland.
Australian Mines said it had to close the deal with SK Innovations, as it did not issue an agreed pre-payment or finance letter to the company.
On October 1, the companies agreed that SK Innovations will issue an agreed pre-paymen letter to Australian Mines by October 31, 2019. The parties will then proceed to negotiate and finalise the formal documentation by January 31, 2020.
“As a result, the Offtake Agreement has automatically terminated on the basis that one or both of the conditions precedent to the Offtake Agreement as described
above were not satisfied by that date,” the company told the market this morning.
Australian Mines said it will remain committed to processing the development of the Sconi Project.
Sconi Project is located in Townsville, Queensland and is one of the few large ore bodies of its type within Australia
The project has a mine life of 18 years and is predicted to produce 8,500 tonnes of cobalt sulphate (1,780 tonnes metal equivalent), 53,300 tonnes of nickel sulphate (11,900 tonnes metal equivalent) and 89 tonnes of scandium oxide.
The company says it is talking to interested third parties and will continue the projects financial discussions with potential financiers.
Australian Mines is down 25.93 per cent on the market this morning and is trading at 2¢ per share at 12:18 pm AEDT.
