How Will Alliance Nickel Navigate Stellantis Offtake Renegotiation at NiWest?

Strategic Capital Raise and Financial Position

Alliance Nickel Limited (ASX, AXN) has taken decisive steps to bolster its financial footing during the December 2025 quarter, completing a placement of approximately $769,000 at a share price premium of 12% to the 30-day volume weighted average price. This capital injection, alongside a $422,000 Research and Development tax refund from the Australian Government, provides the company with essential working capital as it advances the NiWest Nickel-Cobalt Project.

At quarter end, Alliance reported cash reserves of $1.3 million supported by a fully drawn unsecured loan facility of $5.2 million. Exploration and evaluation expenditures amounted to $530,000, reflecting ongoing commitment to project development despite challenging market conditions.

NiWest Project, A Robust Feasibility and Long-Term Outlook

The Definitive Feasibility Study (DFS) completed in late 2024 continues to underpin the NiWest Project’s commercial attractiveness. With a 35-year mine life and an estimated capital cost of A$1.65 billion, the project is positioned in the first cost quartile for nickel production globally. The use of heap leach technology promises a simpler, safer, and lower capital-intensive operation compared to traditional methods.

NiWest boasts a globally significant JORC resource of 93.4 million tonnes at 1.04% nickel, containing 971,000 tonnes of nickel. The project’s average annual production is forecast at around 20,000 tonnes of contained nickel and 1,600 tonnes of contained cobalt over the first 12 years, targeting premium battery-grade sulphate products for the electric vehicle (EV) market.

Offtake Agreement with Stellantis Under Review

In a notable development, Stellantis N.V. has terminated the binding offtake agreement effective December 3, 2025, citing unmet contractual milestones largely due to nickel market volatility and financing challenges. However, Stellantis remains a significant shareholder with an 11.5% stake and retains a board seat, signalling ongoing strategic interest.

Alliance is actively renegotiating the offtake terms to better align with the revised project timeline and current market realities. This renegotiation will be critical for the project’s commercial pathway and investor confidence.

Government Support and Market Context

NiWest maintains its Major Project Status, a designation that facilitates streamlined government approvals and underscores the project’s national significance. The Western Australian Resources Minister has reiterated strong support, highlighting NiWest’s role in Australia’s critical minerals supply chain and the domestic battery industry.

On the international front, the US-Australia Framework for Securing Supply in Critical Minerals, signed in October 2025, positions NiWest as a potential supplier for North America’s EV battery and defence sectors. Meanwhile, nickel prices have shown recovery following Indonesian supply restrictions, reinforcing the long-term demand fundamentals for high-purity nickel and cobalt.

Looking Ahead

Alliance Nickel’s December quarter results reflect a company navigating the complexities of project development amid shifting market and contractual landscapes. With a solid DFS foundation, government backing, and strategic partnerships, the company is poised to advance NiWest, though the outcome of Stellantis negotiations and funding strategies will be pivotal in the near term.