Nickel Industries Cuts ENC Acquisition Costs by $207M, Boosts Stake to 46%

Strategic Partnership Strengthens ENC Project

Nickel Industries Limited (NIC) has announced a significant milestone with the completion of Sphere Corporation’s acquisition of a 10% equity interest in the Excelsior Nickel Cobalt (ENC) High Pressure Acid Leach (HPAL) project. Valued at US$2.4 billion, Sphere’s investment not only injects capital but also brings a strategic partner with strong aerospace credentials, as Sphere is a key accredited supplier to SpaceX. This association underscores the growing importance of traceability, quality, and sustainability in nickel production, particularly for high-performance applications such as electric vehicle batteries and aerospace alloys.

The ENC project, located in Indonesia, is positioned as a next-generation HPAL operation capable of producing mixed hydroxide precipitate (MHP), nickel and cobalt sulphate, and nickel cathode. With Sphere’s entry, the project gains external validation as a global showcase for sustainable, low-carbon nickel production.

Revised Acquisition Terms Enhance Financial Flexibility

In a parallel development, Nickel Industries has reached an agreement with its largest shareholder, Shanghai Decent, to revise the ENC acquisition schedule. Instead of the previously planned two payments totalling US$253 million, NIC will make a single final payment of US$46 million by 31 March 2026 to increase its stake from 44% to 46%, thereby becoming the largest shareholder in the project. This revision reduces NIC’s expected cash outflows by US$207 million, providing greater certainty and strengthening the company’s balance sheet.

Sphere’s acquisition was financed through a US$210 million senior secured amortising term loan. To facilitate this, Nickel Industries has provided credit enhancement to Sphere’s lenders, effectively securing Sphere’s 10% ENC stake against third-party acquisition in case of default. This arrangement also positions NIC to potentially acquire Sphere’s stake at a discount if necessary, while receiving compensation for the guarantee provided.

Long-Term Ore Supply Agreement Unlocks New Value

Further cementing its integrated business model, Nickel Industries has signed a 15-year exclusive Memorandum of Understanding (MOU) to supply up to 14 million wet metric tonnes per annum of limonite ore from its Sampala Project to a nearby HPAL project under construction. The MOU includes plans for a feed preparation plant and a connecting slurry pipeline, an innovative solution that could enable transport of previously uneconomic low-grade saprolite ore by slurry rather than haul trucks. This first-of-its-kind approach has the potential to unlock additional value from the Sampala ore body and support future downstream growth opportunities.

Managing Director Justin Werner highlighted the strategic importance of Sphere’s investment and the Sampala MOU, noting that these developments reinforce ENC’s position and enhance Nickel Industries’ financial and operational flexibility as it transitions towards sustainable nickel production for the electric vehicle supply chain.