The EV Race is Heating Up. This is the New Nickel Play You’ve Been Looking For

(Turnagain nickel project image via Giga Metals Corp.)



Much like when he drew attention to bitcoin via his comments, Tesla Inc (NASDAQ: TSLA) head Elon Musk generated a lot of attention to nickel when he made comments last year about its predicted global shortage. Along with copper, and other electric vehicle (EV) battery metals, Musk warned of an undersupply of nickel due to underinvestment in the mining sector.

“Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” – Elon Musk.

Nickel is a critical mineral, as it is crucial to high-tech manufacturing in industries such as EVs, renewable energy, aerospace, defense, and agri-tech.

Nickel is a commodity that has traditionally been mostly utilized in stainless steel. What is changing now is the rise of EVs and the rise of more powerful batteries. Nickel is a key element in lithium-ion batteries. It has excellent energy density, which is why battery companies have been spending immense research budgets to increase the nickel percentage in their cathode chemistry. The higher the cathode nickel content, the greater the range of the electric vehicle.

The rise of electric vehicles will pose significant challenges for nickel supply. Total world production is currently about 2.5 million tonnes per year (tpy) of nickel, with only half of that in a form suitable for batteries. Experts estimate that lithium-ion batteries alone could require an additional 1.5 to 2.5 million tpy of battery-grade nickel by 2040, which would require 40-70 new nickel projects averaging 35,000 tpy to be built in that time. Where will this supply come from?

Giga Metals Corp. (TSX-V: GIGA, Forum) aims to supply battery metals such as nickel and cobalt to support the world’s progression towards clean energy, and the management’s goal is to build the world’s first carbon neutral nickel mine.

Giga’s Turnagain nickel project in British Columbia is among the largest undeveloped sulphide nickel deposits in the world in terms of total contained nickel. In the Company’s Preliminary Economic Assessment (PEA) it modelled production capacity of 37,000 tonnes per year of nickel for a 37-year mine life. The nickel and cobalt would be a very clean concentrate that could be sold to a smelter or could be directly processed into intermediates that would provide for a more efficient route to the battery cathode.


(Initial PEA results via Giga Metals Corp.)


(Giga Metals’ Turnagain base map from BC Ministry of Transport and Infrastructure.)

As the team works toward developing this project as an open pit mine, the Company’s Chief Executive Officer, Mark Jarvis explained in an interview with Stockhouse Editorial that the economics of the Turnagain nickel project, which are marginal at the low end of the nickel price range, nonetheless compare favorably to the projected economics of other large, undeveloped nickel deposits around the world.

Giga Metals recently announced that they are on the pathway to achieving carbon neutrality without purchasing any carbon credits. The tailings at Turnagain could sequester more CO2 than their scope 1 + 2 emissions. The CO2 will be absorbed from the atmosphere and convert the host rocks to carbonate minerals.

To see how the process will work, the team created this short video:



The test work on the Turnagain host rocks was conducted by a team led by the University of British Columbia’s Dr. Greg Dipple, who has been studying mineral sequestration of CO2 in mine tailings around the world for more than 15 years.

According to Dr. Dipple’s research, the greenhouse gas is absorbed by exposing tailings or other waste rock to the atmosphere, which converts the host rock minerals to carbonate minerals, locking away the CO2 for geological time periods.

At the demonstrated basic sequestration rate measured in the study and factoring in the tailings management facility size used in the preliminary economic assessment, Giga Metals estimates that approximately 900,000 tonnes of CO2 would be sequestered over the life of the mine.

Giga Metals’ president and director, Martin Vydra stated in the media release on this news that the team now has empirical data that supports the Company’s ambition to build the world’s first true carbon neutral nickel mine, meaning a project that achieves carbon neutrality without purchasing carbon credits.

The Company continues to investigate expansion of processing at its Turnagain Ni/Co project to include Mixed Hydroxide Precipitate (MHP) production in its next phase of studies. MHP is a chemical form of nickel and cobalt that is experiencing rapid demand increase for its role in the supply chain for lithium-ion batteries.

Quickly establishing itself as the intermediate of choice by the battery industry in the manufacturing of metal salts (NiSO4 and CoSO4), MHP is being pursued to directly produce precursors and cathode active materials.


(Chart via Giga Metals Corp. Resource estimate from Turnagain PEA (effective date Oct 28, 2020). Garth Kirkham, P.Geo. is the NI 43-101 Qualified Person for resource estimate. Click to enlarge.)


The Company’s goal is to de-risk the project and advance the engineering as far along as possible before the next wave of nickel demand hits.

“For a battery maker to be competitive with China, it will need long term supplies of nickel at a predictable price,” said Mr. Jarvis. “The Chinese have been securing this supply by building their own mines, mostly HPAL projects in tropical islands like Indonesia and Papua New Guinea. These mines have very poor financial returns in Western terms because the capital costs may not be paid out for decades, but the long term cost of the nickel is the operating cost for the mine to produce nickel units. With a low cost of capital, the Capex payout is strategically less important than the operating cost.”

“As a battery or electric vehicle maker, how do you compete with that strategy?” asked Mr. Jarvis. “No nickel producer will give you a long-term supply contract at a fixed price. Why would they? If you end up having to buy nickel based on the spot price, there will be no way you can compete with the Chinese in the long term. Western manufacturers are going to have to figure out some form of vertical integration in their raw material supply chain.”



(Giga Metals Corp. Board of Directors. Click to enlarge.)

Beginning in the summer of 2021, the work schedule at Turnagain includes resource drilling and geo-technical drilling at the mine site, all of which is needed to support a pre-feasibility study.

Heading into the fall and winter of this year, the team intends to undertake further metallurgy and engineering, with a target to have a pre-feasibility study completed by the end of Q2 2022.

For more details on this Company, visit gigametals.com.


FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.