Stellantis is terminating its binding offtake agreement with Alliance Nickel for nickel and cobalt from the NiWest project in Western Australia due to missed milestones.
The termination will take effect on December 3.
According to Alliance, the termination of the contract is due to the failure to meet certain important dates, rendering the existing agreement “inoperative.”
The company attributed the missed milestones primarily to weak nickel market conditions and subsequent difficulties in securing project financing.
Despite the termination, Alliance said Stellantis remains interested in the NiWest Project and has expressed a willingness to renegotiate purchase terms that would better align with a revised project development schedule and current market dynamics.
Alliance said it will provide further updates as talks with Stellantis progress.
The company highlighted the decline in nickel, noting that commodity prices have been under pressure for the past two years, a trend that has limited funding for nickel startups around the world.
Those conditions have forced the company to delay development of the project while it seeks suitable financing agreements aimed at generating value for shareholders.
The company added that it is weighing strategic options, including a potential special purpose acquisition company (SPAC) transaction, which could lead to a Nasdaq listing.
Alliance CEO Paul Kopejtka said: “We understand the rationale for Stellantis’ decision while recognizing that this presents a good opportunity for both parties to negotiate a new agreement that better reflects the revised project development schedule and future strategy. I firmly believe that the long-term outlook for nickel and cobalt remains positive.”
Stellantis and Alliance signed a supply agreement in 2023 for the delivery of 170,000 tonnes of nickel sulphate and 12,000 tonnes of cobalt sulphate over an initial period of five years. That volume was equivalent to approximately 40% of the estimated annual production of the NiWest project.
The deal also included a €9.2 million equity subscription by Stellantis for an 11.5% stake in Alliance Nickel.
Earlier this week, FCA US, a subsidiary of Stellantis, canceled its purchase agreement with Novonix after the parties failed to agree on battery cell product specifications and mass production qualification milestones.
“Stellantis scraps purchase deal with Alliance Nickel but willing to renegotiate” was originally created and published by Just Auto, a brand owned by GlobalData.
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