ASX-listed junior Legacy Minerals has lodged an exploration licence application (ELA6901) over the Nico Young nickel/cobalt deposit in New South Wales (NSW) – a resource containing about one-million tonnes of nickel and 100 000 t of cobalt.

The licence application represents a counter-cyclical strategic move to acquire one of Australia’s largest undeveloped nickel deposits at zero acquisition cost, following the relinquishment of the project by the administrator of Jervois Global, which recently entered Chapter 11 bankruptcy proceedings.

There are no liabilities, encumbrances or private royalties associated with the Nico Young deposit, the company said on Tuesday.

“A free-peg, representing a zero-dollar acquisition cost, of a near one-million tonne, nationally significant, Jorc 2012-compliant, nickel/cobalt deposit is a great, long-term opportunity for our shareholders,” said Legacy Minerals CEO and MD Christopher Byrne.

“Securing an exploration licence application over the Nico Young nickel/cobalt project represents a highly strategic, counter-cyclical move with immense upside.”

The company noted that nickel and cobalt markets were currently under pressure owing to oversupply, particularly from Chinese-owned refinery product originating in Indonesia. As a result, Legacy Minerals said it would minimise holding costs and preserve the asset until market conditions improved. The company would fund these costs from existing cash reserves.

Partnering discussions were also under way to further the development of Nico Young. Legacy noted that the project's size and location offered an attractive opportunity for national and international groups seeking strategic critical minerals exposure.

“Nico Young is the largest contained nickel deposit in NSW, which also hosts other major nickel/cobalt deposits including the nearby Robert Friedland-led Sunrise Energy Metals,” Byrne added.

“This diversification adds optionality to the company's overall asset base… shareholders have significant exposure to a multi-commodity, multi-project discovery and development opportunity.”

In addition to the existing nickel/cobalt resources, the deposit is known to contain variable levels of scandium. There is also untested potential for platinum group metals, which could be reassessed as part of Legacy’s future evaluation work.

Legacy retains its core focus on the Drake, Thomson, and Black Range gold/copper/silver projects, as well as joint ventures with Newmont, S2 Resources, Helix, and EarthAi.