Rebuilding team for NICO development as public highway to
Whati & cobalt market advance
Issued Capital: 255,649,007
LONDON, ON, April 18, 2016 /CNW/ - Fortune Minerals
Limited (TSX: FT) (OTCQX: FTMDF) ("Fortune" or
the "Company") (www.fortuneminerals.com) announces the
appointment of former minister of the Government of the
Northwest Territories ("GNWT") Mr.
David Ramsay to the Company's board
of directors. Mr. Ramsay has more than 20 years of elected public
office experience in the Northwest
Territories, which included prominent cabinet positions in
the Legislative Assembly. Prior to November
2015, he was Minister of Industry, Tourism and Investment
that includes the preeminent mining portfolio, accounting for about
50% of private sector GDP in this jurisdiction. Mr. Ramsay has also
served as Minister of Justice, Attorney General, Minister of
Transportation and the Minister Responsible for the Public
Utilities Board for the GNWT. Mr. Ramsay brings important political
experience and business acumen to the board while Fortune works
with three levels of government on road and power infrastructure
initiatives that are important to the success of the Company's NICO
gold-cobalt-bismuth-copper project.
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Key Highlights
- David Ramsay appointed to
Fortune's board of directors
- Public highway to the community of Whati advancing
- Tesla validates EV demand, positively impacting cobalt
market
"I am very excited to join the Fortune Minerals team at a
critical stage in the development of the NICO project", said
David Ramsay. "As the Minister
responsible for mining in the previous Legislative Assembly, I have
followed the progress of this vertically integrated project with
interest and recognize its importance to sustain mining as a pillar
of the Northwest Territories
economy. Having a reliable Canadian solution to the impending
supply deficit for cobalt will be critical to global electronics
companies that need cobalt to make lithium-ion batteries used to
power portable electronic devices, electric vehicles and stationary
storage cells. It is gratifying to be part of a solution to air
quality concerns and climate change by reducing our dependence on
fossil fuels with the growth of automotive industry
electrification."
As a 36-year resident of the Northwest
Territories, David Ramsay has
been involved with numerous businesses and was the recipient of the
Young Entrepreneur Award from the Business Development Bank of
Canada in 1996. He was first
elected to public office in 1997 and served five years as a
Yellowknife City Councillor, where he chaired the Corporate
Services Committee and represented the City on the Diamond Task
Force. Dave Ramsay was elected to
the Legislative Assembly in 2003, representing the riding of Kam
Lake in Yellowknife. In addition
to serving in Cabinet, Mr. Ramsay was Vice President of the Pacific
Northwest Economic Region ("PNWER") from 2011 to 2014, and
President between 2014 and 2015. The PNWER is a statutory public /
private partnership of Alaska,
Idaho, Oregon, Montana, Washington, British
Columbia, Alberta,
Saskatchewan, Yukon and the Northwest Territories whose mandate is to
increase the economic well-being and quality of life for all
citizens of the region, while maintaining the natural environment.
Dave Ramsay is also President of RCS
Limited and Northern Building Solutions and he is a director of
Northern Gateway Consulting.
Public highway to the community of Whati
advancing
The GNWT - Department of Transportation has
submitted applications to permit a 94-kilometre all-season public
highway to the community of Whati (see Fortune news release dated
April 11, 2016). This initiative,
developed with the support of the Tlicho Government, would reduce
the cost of living and improve the quality of life in the outlying
Tlicho communities, while also promoting economic activity and
diversification in the region. These communities are isolated and
are currently serviced by winter ice roads, which have become
unreliable and expensive to maintain because of climate change.
Fortune has already received environmental assessment approval to
build a spur road from Whati to its proposed NICO mine located 50
km north of the community to transport metal concentrates south to
its proposed refinery for further processing.
NICO project
Fortune owns the vertically
integrated NICO gold-cobalt-bismuth-copper development, comprised
of a planned mine and concentrator in the Northwest Territories and refinery near
Saskatoon to process concentrates
from the mine to higher value products. The NICO project has
already been assessed in a positive feasibility study and has
received its environmental assessment approvals in the Northwest Territories and Saskatchewan. The NICO mineral reserves will
support a 21-year mine life at a mill feed rate of 4,650 tonnes of
ore per day to produce 180 wet tonnes of concentrate per day for
shipment to the refinery. Life of mine average annual production is
projected to be 41,300 ounces of gold, 1,615 tonnes of cobalt
contained in a battery grade cobalt sulphate heptahydrate, 1,750
tonnes of bismuth contained in ingots, needles and oxide, and 265
tonnes of copper.
Tesla validates EV interest, cobalt market expanding due
to lithium-ion batteries
Cobalt is the dominant metal in
the NICO project. The cobalt market has had compound annual growth
of 5 to 6% for the past two decades and in 2015 grew by 5.4%, more
than double global GDP growth of 2.4% for the same period. Market
growth has been driven primarily by the demand for cobalt in
chemicals needed to make lithium-ion rechargeable batteries.
Battery chemical demand increased nearly 12% in 2015 and now
accounts for approximately half of the world's annual cobalt
production. Double digit percentage growth of cobalt used in
rechargeable batteries is expected to continue for the foreseeable
future. Supporting this positive outlook, Tesla Motors made
automotive history on March 31, 2016
with the launch of its Model 3 electric vehicle, receiving
US$325 million in deposits from
325,000 pre-orders of these cars in the first week and validating
mainstream interest in electric vehicles.
Analysts are projecting a supply deficit for cobalt in 2016
because of the increased demand. Additionally, as demand continues
to grow, cobalt supply is under pressure, in part because it is
produced primarily as a by-product of nickel and copper mining, and
some high-cost mines have recently closed due to low base metal
prices. The risks to cobalt supply are further exacerbated by
concentration of supply with 65% of mine production currently
sourced from the Democratic Republic of
the Congo, a politically unstable country, and 52% of
refinery production in China. This
risk was recently addressed in the Assessment of Critical
Minerals report to the U.S. Congress which identified cobalt as a
critical mineral on a list that, "have a supply chain that is
vulnerable to disruption, and that serve an essential function in
the manufacture of a product, the absence of which would cause
significant economic or security consequences.
NICO is well positioned to become a reliable, vertically
integrated North American producer of battery grade cobalt
chemicals with supply chain custody transparency and tax advantages
under the North American Free Trade Agreement (NAFTA). Earlier in
2016 the Company delivered an ultra-pure cobalt sulphate sample for
testing by a potential customer. Discussions for offtake agreements
and project financing are ongoing.
The NICO deposit also contains a significant gold co-product
from more than 1.1 million ounces of gold in its mineral reserves,
as well as 12% of global bismuth reserves. Bismuth is a metal used
in a broad range of industrial applications, particularly in the
automotive and pharmaceutical sectors. It is also an
environmentally safe replacement for lead, which is subject to
lead-toxicity concerns and legislation banning its use in potable
drinking water sources and some consumer products. Bismuth is used
to replace lead in solders, brasses, steel, aluminum and
zinc-galvanizing alloys, paint pigments, cosmetics and ceramic
glazes. Notably, bismuth was also identified in the Assessment of
Critical Minerals report to the U.S. Congress.
The disclosure of scientific and technical information contained
in this press release has been approved by Robin Goad, M.Sc., P.Geo., President and CEO of
Fortune, who is a "Qualified Person" under National Instrument
43-101. The technical report on the feasibility study referred to
above, entitled "Technical Report on the Feasibility Study for the
NICO-Gold-Cobalt-Bismuth-Copper Project, Northwest Territories, Canada", dated
April 2, 2014 and prepared by Micon
International Limited, has been filed on SEDAR and is available
under the Company's profile at www.sedar.com.
About Fortune Minerals
Fortune is a Canadian
development stage mining company focused on advancing the
vertically integrated NICO gold-cobalt-bismuth-copper project in
the Northwest Territories and a
related refinery the Company plans to construct in Saskatchewan. Fortune also owns the Sue-Dianne
copper-silver-gold deposit located 25 km north of NICO and a
potential future source of incremental mill feed to extend the life
of the NICO mill. The Company also maintains the right to
repurchase the Arctos anthracite coal deposits in northwest
British Columbia that were
recently purchased by a provincial Crown corporation.
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This press release contains forward-looking information and
forward-looking statements within the meaning of applicable
securities legislation. This forward-looking information includes
statements with respect to, among other things, the Company's plans
to develop the NICO project, anticipated growth in the demand for
cobalt, anticipated constraints on the supply of cobalt and the
plans of the plans of the GNWT and the Tlicho Government to build
an all-season road to Whati and plans of the GNWT to expand power
generation into the Snare – Yellowknife electrical grid. Forward-looking
information is based on the opinions and estimates of management as
well as certain assumptions at the date the information is given
(including, in respect of the forward-looking information contained
in this press release, assumptions regarding the Company's ability
to arrange the necessary financing to continue operations and
develop the NICO project, growth in the demand for cobalt,
restrictions on the supply of cobalt and the proposed construction
of the all-season road to Whati and expansion of the Northwest Territories electrical grid).
However, such forward-looking information is subject to a variety
of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected
in the forward-looking information. These factors include the risks
that the Company may not be able to arrange additional financing to
continue operations, the Company may not be able to finance and
develop NICO on favourable terms or at all, the demand for cobalt
may not grow to the extent anticipated, the supply of cobalt may
not be restricted to the extent anticipated and the construction of
an all-season road to Whati and the expansion of power generation
into the Snare – Yellowknife
electrical grid may not be completed in a timely fashion or at all.
Readers are cautioned to not place undue reliance on
forward-looking information because it is possible that
predictions, forecasts, projections and other forms of
forward-looking information will not be achieved by the Company.
The forward-looking information contained herein is made as of the
date hereof and the Company assumes no responsibility to update or
revise it to reflect new events or circumstances, except as
required by law.
SOURCE Fortune Minerals Limited
