Amid growing demand for critical minerals, Canadian exploration and development company Nickel Creek Platinum has unveiled the results of a positive prefeasibility study (PFS) for its Nickel Shäw project, in Yukon.

With more than 4.2-billion pounds of nickel, 1.2-billion pounds of copper, 6.9-million ounces of platinum group metals (PGMs) and 137-million pounds of cobalt in the measured and indicated resource categories, Nickel Shäw is one of the biggest undeveloped nickel projects in North America not controlled by a major mining company.

The study, prepared by AGP Consultants, is based on Nickel Shäw producing a yearly average of 29.1-million pounds of nickel, 9.1-million pounds of copper, 1.1-million pounds of cobalt, 27 400 oz of platinum, 36 200 oz of palladium and 7 700 oz of gold.

Capital expenditure of C$1.7-billion will be required to build the mine, which will operate for 19.1 years. The project has an aftertax payback period of 12.7 years.

The PFS estimates an after-tax net present value (NPV), at a 5% discount rate, of C$143-million, with an after-tax internal rate of return (IRR) of 5.8%.

Nickel Creek CEO Stuart Harshaw highlights that there are opportunities to improve the project economics, notably in terms of energy costs.

If paying Yukon grid rates of C$0.11/kWh, the after-tax NPV, at a 5% discount, increases by C$424-million to C$467-million. If the Canadian tax incentive for critical mineral companies is enacted, the NPV increases from C$143-million to C$336-million.

“The sensitivity to energy costs illustrates how working with the different levels of government can lead to a significant improvement in value, especially when combined with the previously announced intention of the federal government to provide a tax incentive for critical mineral projects such as Nickel Shäw,” says Harshaw.

Nickel Creek is also further investigating the opportunity of carbon tax offsets associated with carbon sequestration in the tailings facility.

“Moving forward, our focus will be to continue to add value to the project through work on identified key economic areas of opportunity and continued mineral exploration success while advancing towards a feasibility study,” says Harshaw.

The project lies in the Kluane First Nation (KFN) core area. Nickel Creek has received good support from the KFN and Yukon Territory for the development of the project.