How Alliance Nickel’s NiWest DFS and Partnerships Could Reshape Battery Metals Supply

Robust Feasibility Study Validates NiWest’s Potential

Alliance Nickel Limited (ASX, AXN) has delivered a comprehensive update for the September 2025 quarter, reinforcing the commercial attractiveness of its NiWest Nickel-Cobalt Project. The recently completed Definitive Feasibility Study (DFS), finalized in November 2024, confirms a 35-year mine life with an open pit operation employing simple mining and heap leaching technologies. This approach promises a safer, lower-cost alternative to more complex processing methods, positioning NiWest in the first cost quartile among global nickel producers.

The DFS projects average annual production of approximately 20,000 tonnes of contained nickel and 1,600 tonnes of contained cobalt over the first 12 years, producing premium battery-grade sulphate products. Financially, the project boasts a post-tax net present value (NPV) of A$1.5 billion at an 8% discount rate, an internal rate of return (IRR) of 17.6%, and a payback period of five years. Capital expenditure is estimated at A$1.65 billion, reflecting a comprehensive engineering, procurement, and construction management plan.

Strategic Partnerships and Market Positioning

Alliance continues to advance strategic discussions with potential partners to support project development. Notably, the company has secured a binding five-year offtake agreement with global automaker Stellantis N.V., covering around 40% of NiWest’s future production. This partnership not only provides a stable revenue foundation but also aligns the project with the growing electric vehicle (EV) battery supply chain.

Additionally, Alliance has engaged with Samsung SDI under a non-binding term sheet for potential offtake and equity participation, further underscoring the project’s appeal to key battery industry players. The company’s ongoing dialogue with these partners reflects a strategic approach to securing both capital and market access.

Financial and Operational Highlights

At quarter-end, Alliance reported cash reserves of A$1.12 million alongside a fully drawn unsecured loan facility totaling A$5.2 million. Exploration expenditure remained modest at A$72,000, focused on evaluation activities. The NiWest Project continues its development phase without any safety incidents, maintaining strong environmental, social, and governance (ESG) credentials, which are increasingly critical in the mining sector.

The project benefits from Major Project Status granted by the Australian government in May 2024, reflecting its strategic importance as a critical mineral supplier. This status is expected to facilitate regulatory approvals and support infrastructure development.

Market Context and Outlook

Nickel prices have remained rangebound around US$15,000 per tonne amid structural oversupply, primarily driven by Indonesian production. While growth in nickel demand for batteries has been slower than anticipated due to the rise of alternative chemistries like lithium iron phosphate, the stainless steel sector continues to underpin demand forecasts through 2026. Alliance remains optimistic about the long-term fundamentals supporting nickel and cobalt, particularly given the global transition to EVs and critical industrial applications.

Looking ahead, the company’s focus will be on advancing funding arrangements and finalising strategic partnerships to move NiWest towards construction and production. The combination of a strong DFS, supportive government status, and established offtake agreements positions Alliance Nickel as a notable player in the critical minerals space.