Supply Chain Worries Drive Sunrise’s Push for Scandium Offtake Deals

Reassessing the Syerston Scandium Opportunity

Sunrise Energy Metals Limited (ASX: SRL) has intensified efforts to update its 2016 feasibility study for the Syerston Scandium Project, reflecting the evolving landscape of the global scandium market. The company is integrating updated capital and operating cost estimates from GR Engineering Services with internal optimisation studies to explore a potential stand-alone scandium processing facility. This facility aims to produce both chemical grade scandium oxide and metal, targeting specialty alloy, semiconductor, and aerospace sectors.

In December 2024, Sunrise engaged Mining One Pty Ltd to update the scandium mineral resource estimate, a critical step towards refining the mine plan and advancing project development. These technical updates are timely, given the growing strategic importance of scandium in high-performance materials.

Navigating Supply Chain Disruptions

Recent discussions with end-users in the United States and Asia have underscored the impact of Chinese export restrictions on scandium products and processing equipment. These constraints have heightened supply chain concerns, prompting Sunrise to receive formal expressions of interest from consumers seeking alternative scandium sources. The company is actively pursuing these leads with the goal of converting interest into binding offtake agreements, which would underpin project financing and development.

Progress on the Sunrise Battery Materials Complex

Parallel to scandium developments, Sunrise continues to advance its flagship Battery Materials Complex focused on nickel and cobalt. Key infrastructure workstreams include long-lead electrical transmission line studies and securing easement agreements with rural landholders. Power system analyses confirm that the existing electrical network can support the project’s forecast load with minimal upgrades, paving the way for Essential Energy to issue a formal connection offer once project timelines are clearer.

Additionally, the company is refining oversize transport route designs following feedback from regulatory authorities, with approvals expected to span the next 12 months. These preparatory steps aim to accelerate project start-up once financing and final investment decisions are secured.

Exploration Momentum in NSW and Queensland

Exploration activities remain robust across Sunrise’s tenements. In New South Wales, field mapping and sampling at the Hunters limestone target are progressing, supporting plans for future drilling campaigns. Limestone is a vital reagent for the company’s processing flowsheets, making resource definition a strategic priority.

In Queensland, the Clonagh Trend Joint Venture is advancing with integrated geophysical surveys and preparatory work for drilling programs scheduled post-wet season in 2025. Negotiations for land access continue, reflecting the company’s methodical approach to exploration in one of Australia’s most mineral-rich provinces.

Financial and Safety Highlights

Sunrise ended the quarter with a cash balance of $6.0 million, reflecting disciplined expenditure on exploration and development activities. Payments to related parties were $219,000, primarily for executive and advisory services. Importantly, the company maintained an unblemished safety record with no lost time injuries or reportable environmental incidents, underscoring its commitment to operational excellence.

As Sunrise Energy Metals navigates the complexities of project advancement and market dynamics, its dual focus on scandium and battery materials positions it well to capitalize on emerging demand for critical minerals in clean energy and advanced manufacturing sectors.