Chalice taps Cutifani’s firm for Aus palladium push

Chalice Mining (ASX: CHN) has appointed Odin Partnership, founded by former Anglo American (LSE: AAL) chief Mark Cutifani, as a strategic adviser to advance its Gonneville palladium-nickel-copper project in Western Australia.

The move brings in a senior trio that also includes former Anglo executive director Tony O’Neill and ex–Bank of America metals and mining lead Omar Davis, as Chalice steps up development planning, financing strategy and market positioning for the asset.

Managing director Alex Dorsch said the endorsement followed a detailed review that began after an introduction in January. “To have someone like Mark Cutifani put his name to Chalice . . . it goes without saying he’s bit of a god of the sector,” he said.

Odin’s team is expected to review the entire Gonneville project as it undergoes a feasibility study now ahead of a final investment decision in the first half of 2028. Chalice is aiming for the project, about 70 km northeast of Perth, to start production in 2030. The 2020 greenfields discovery hosts 17 million oz. of palladium, platinum and gold (3E), 960,000 tonnes of nickel, 540,000 tonnes of copper and 96,000 tonnes of cobalt, according to a 2023 resource. 

Building capacity

Work with Odin is expected to run from marketing to staging, management talent, potential partners, and off-takers, and help determine the optimal financing structure. Chalice already has a non-binding memorandum of understanding with Mitsubishi, which has provided technical and marketing input.

Odin’s networks across platinum group elements and base metals are expected to lift Chalice’s profile in Europe and North America, where the company has had limited exposure.

The consultant will assess organizational capability, review capital markets strategy and conduct an independent technical and value optimization review of the project. Interest in Gonneville has remained strong from customers, financiers and strategic partners, Dorsch said, with several parties still evaluating the asset. 

The discovery once pushed Chalice’s market capitalization above A$3 billion ($2.1 billion). Despite weaker nickel prices since then, the company has continued to advance the project.

 

$A820M capex

A prefeasibility study released in December outlined initial capital costs of A$820 million ($580 million) for stage one of a 23-year operation. The project is forecast to annually produce 220,000 oz. 3E, 7,000 tonnes nickel, 8,000 tonnes copper and 700 tonnes cobalt at all-in sustaining costs of $370 an oz. of 3E, net of by-product credits.

Chalice estimates cumulative pre-tax free cash flow of A$4.7 billion based on assumed prices of $1,300 an ounce for palladium, $18,750 a tonne for nickel and $10,500 a tonne for copper. The project carries a post-tax net present value at an 8% discount rate of A$1 billion, a pre-tax internal rate of return of 23% and a 2.7-year payback period.

A planned A$840 million expansion from 5 million tonnes a year to 14 million tonnes in year five would be funded from post-financing cashflows.

Shares in Chalice Mining fell 1.9% on Monday in Sydney to close at A$1.56 apiece, valuing the company at A$608 million. It’s traded in a 52-week range of A98¢ to $2.75.