Project developer Fortune Minerals may defer its planned metals processing plant near Saskatoon, Saskatchewan, and may opt to sell concentrates from the flagship Nico mine directly to third parties, the company said on Thursday.

The London, Ontario-based company has approval for a $200-million metals processing plant to process concentrates from the mine in Northwest Territories to cobalt sulphate, gold, bismuth ingot and oxide and copper precipitate.

However, with third-party refiners now interested in purchasing concentrates directly from the mine, Fortune is making adjustments to the Nico project’s engineering designs to allow for flexibility in downstream processing options.

Consultants are already busy updating the Nico project’s 2014 feasibility study and Hatch has now been asked to adjust the engineering design to move the bulk concentrate regrind circuit and secondary flotation concentration process back to the Northwest Territories site.

Fortune indicated that it is considering four development scenarios:

• produce a single bulk flotation concentrate at the mine as currently envisioned for sale to a third party refinery or, transport it to Saskatchewan for downstream processing at the company's planned refinery;
• produce separate cobalt/gold concentrate and bismuth/gold concentrate at the mine and sell either or both of these to third-party refineries or, transport either or both of these to Saskatchewan for downstream processing with facilities configured with only the required unit operations needed to recover the desired metal(s);
• defer the sale of some of the bismuth to align production with the market demand;
• phase the development of the Saskatchewan refinery with market demand and the needs of the potential strategic partners.

“Although the sale of concentrates was previously investigated by Fortune, the expanded cobalt market, strong future growth, and attractive prices have collectively made this into a potentially attractive development option to defer significant up-front capital,” the company said in a statement.

Fortune added that it was investigating technologies that would help it to upgrade the metal content of its concentrates and to reduce deleterious metals that were typically penalised by third-party process plants.

Should Fortune receive the requisite financing for the Nico project and the remaining regulatory approvals in 2018, construction of the mine facilities could begin next year and is expected to take about two years depending on ice-road logistics.

The refinery requires about 18 months for construction, unless it is deferred.

Fortune aims to have the Nico project in commercial production in the early 2020s, when it expects demand for cobalt cathodes to be particularly strong, driven by demand from lithium-ion batteries that are used to power portable electronic devices, electric vehicles and stationary storage cells.