Pure Minerals says updated prefeasibility study results show its planned Townsville battery chemicals plant would deliver significant returns even against current depressed markets.

The next steps are to complete pilot plant test work, a definitive feasibility study and obtain all required development approvals, the company says.

However it is expecting the impacts of the COVID-19 crisis on business activity to set back the timetable for development, with final investment decision now tipped for the fourth quarter of next year.

The updated study for the Townsville Energy Chemicals Hub (TECH) looked at the addition of a high-purity alumina (HPA) refinery to the plant at a cost of $98.7 million.

It also included optimisation work to reduce gas and water consumption.

It was based on a $554 million development resulting in a plant with a 30-year life, with an annual production of 26,398 tonnes of nickel sulphate, 3097 tonnes of cobalt sulphate, 4007 tonnes of HPA, 327,665 wet metric tonnes if hematite and 20,079 tonnes of magnesia.

“The updated PFS demonstrates that the TECH project can be a significant supplier of battery chemicals, generating robust financial returns with soft commodity prices and excellent financial returns in stronger commodity cycles,” Pure Minerals managing director John Downie said.

“The strong economics for the TECH project will appeal to offtakers and strategic investors who are seeking to support projects that can deliver certainty of supply at all times.

“It has only been 10 months since the acquisition of QPM by Pure Minerals and in that time the team has accomplished many milestones including the $2.55 million CRC-P grant, conditional granting of land in Townsville and the completion of this PFS .

“In these trying times, we look forward to continuing to advance the TECH project and delivering value to our shareholders.”