AUSTRALIAN nickel producer Western Areas has completed two offtake deals for its WA high-grade Forrestania Nickel Operation concentrate product which is a feedstock for the electric vehicle battery market.

The ASX-listed company said the offtake-deals are with BHP’s Nickel West subsidiary in WA, and Hong Kong-listed Chinese nickel company Jinchuan Group, and both were awarded by Western Areas following a competitive tender process.

Western Areas managing director Dan Lougher said the company was pleased with its new contracts that extend its relationship with BHP and reintroduces Jinchuan as an offtake customer.

“It is notable that both of our offtake customers are involved in the downstream operation of nickel smelters,” he said.

“Western Areas firmly believes that the smelting of concentrates is a key process to continue to feed both the emerging electric vehicle battery market, via nickel sulphate, and the traditional stainless steel market.”

The company’s new agreement with BHP Nickel West is for three years starting from February 2020 for 10,000tpa of nickel contained in concentrate up to 30,000t and payable rates are confidential.

Its deal with Jinchuan is for two years starting in February 2020 with a one-year extension option, and is for 10,000tpa up to a 20,000t limit for delivery to China on a cost-and-freight price basis, although the payable rate in the contract is confidential.

Western Areas said that as a result of its new offtake deals with BHP and Jinchuan, its existing supply contract with Tsingshan Group will end as planned at the end of January 2020.

BHP Nickel West has an existing offtake agreement with Western Areas that ends January 31, 2020.