Ardea Resources (ASX: $ARL) March 2024 Quarterly Report

Ardea Resources Limited (ASX: $ARL) has reported a cash position of $17M as at 31 March 2024, with no debt. The company's primary focus remains on advancing the development of the world-significant Kalgoorlie Nickel Project (KNP). Key highlights of the March 2024 Quarter include the company's progress in negotiations with a consortium consisting of Sumitomo Metal Mining and Mitsubishi Corporation for the strategic partner process, as well as the commencement of early works for the Definitive Feasibility Study (DFS) for the KNP - Goongarrie Hub.

Executive Commentary on Nickel and Cobalt Sector

On 16 February 2024, nickel was added to the Australian Critical Minerals list by the Commonwealth Government, emphasizing the significant role that Australian nickel production needs to play in the global energy transition. The long-term fundamentals for unprecedented nickel demand are predominantly linked to growing Electric Vehicle (EV) and battery energy storage system (ESS) use, in addition to traditional uses such as stainless steel. Despite the current oversupply of nickel, the rapid rise of alternative funded nickel production in jurisdictions beyond Australia has prompted numerous nickel producers to announce production restraint, which helped drive a price rebound taking nickel to a peak of US$18,590/t in March, from the February low at US$15,850/t. As a result of higher London Metal Exchange (LME) nickel prices, there was an increase in nickel sulfate and MHP prices. Cobalt metal prices in the seaborne market have remained flat in March, trading around US$12.50 per pound.

Outlook and Corporate Strategy

Ardea's priority is the development of the KNP - Goongarrie Hub to produce Battery and Critical Minerals for the LIB supply chain, further advancing the transition to a low carbon future. The company's focus for the upcoming quarter includes continued engagement with stakeholders, community consultation, and the commencement of the DFS process test work and process design updates. Ardea also aims to progress the strategic partner process and secure off-take, with the primary driver for all strategic partner engagements being the securing of project equity investment and project development finance.