Critical Minerals and Energy Intelligence

Nickel Heats Up as Majors Battle

BHP, the world’s largest miner is battling Andrew Forrest, the billionaire founder of Fortescue Metals Group, for ownership of Canadian nickel developer Noront Resources, a move backed by Noront’s board.

As reported by Bloomberg, in August 2021, BHP came in with a $260 million offer but Forrest’s Wyloo Metals, already owned about 25% of Noront and held a convertible loan refused to sell its shares, leaving the door open for a potential counter-offer—provided Noront would grant access to its books for due diligence. Noront, for its part, said it would—if Wyloo signed a confidentiality agreement. Just as the Noront fight was unfolding, Australian producer Western Areas announced it was in takeover talks with a local rival and that Forrest was a significant shareholder.

Nickel is big business and it’s going to get bigger! Elon Musk has been vocal about nickel in the battery space, calling on miners last year to “please mine more.” Automakers are desperate to lock in reliable, sustainable sources of supply, and the mining sector is trying to step up.

It’s interesting back in 2014, BHP was looking to offload its Nickel West operations in Australia. Fast forward to now, and the same asset is now a centerpiece of its strategy.

Forrest made his fortune in iron ore by challenging the dominance of BHP and Rio Tinto during the last commodity supercycle, but he actually started out in the industry at Anaconda Nickel, developing the Murrin Murrin mine before being pushed out in 2001.

There’s also a backdrop to this nickel excitement. China’s Tsingshan Group has stirred the market with plans to produce battery-grade nickel from materials traditionally used for stainless steel—a subject I wrote about in The Northern Miner earlier this year.

In short, this could be just the start of increasing competitive M&A in the nickel sector. The electrification of all things is going nowhere except forward. The electric metals sector – including nickel – is in a race to keep pace. There’ll be more battles to come.

Anthony Milewski

Chairman, Nickel 28 Capital

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