Hi there. I'm Chris Showalter, CEO, Lifezone Metals.
Very good. Thank you for joining. The webinar has just started. If I could just give everybody a few housekeeping details before we get going. To start with, my name is Michael Mathison. I'm an equity analyst here with Sidoti. And secondly, we really encourage everybody to ask questions. Everyone gets the most out of the event if there's participation like that. To ask a question, there is a bar at the bottom of your screen. Toward the right-hand side, there's a circle with three dots in it. Click on that. You'll find access to a Q&A screen. Just type in your question, and we'll read it out toward the end. And Chris, if you could leave about five or ten minutes at the end for questions, that'd be great. So with that, Chris Showalter, CEO of Lifezone Metals, please take it away.
Great. Thanks, Michael. Yeah, so I guess first and foremost, thanks for having us on today. By way of introduction, again, so Chris Schowalter, CEO of Lifezone Metals. Lifezone Metals, we are really the owners and operators of really the largest development-ready nickel sulfide project with copper and cobalt globally. And so this is a highly strategic project when it comes to critical metals and supply chain. And we, as Lifezone Metals, we're a New York Stock Exchange-listed company. We trade under ticker LZM. And we're a combination of two things. So we are both a technology company, and then we have our flagship project, the Kabanga Nickel Project in Tanzania. And what we do is we leverage our technology, which is hydrometallurgy, where we have 120 global patents.
And we leverage that expertise to unlock some of these new sources of critical metals that are really becoming vital to this emerging kind of bifurcation you're seeing in the world economies where supply chains are becoming very much of important strategic interest. So on the hydromet side, we leverage that to produce flow sheets, engineering design to replace what is really one of the core elements in the processing of minerals, which is smelting. Hydromet uses really a water-based pressure oxidation and a series of leachings and filtrations. So it's much more energy efficient. And the way we look at projects, we basically do these in a cheaper, more efficient capital way also. When people look at us as a company, a lot of the attention goes to the Kabanga Nickel Project. And for good reason. We finished up a bankable feasibility study on this project in July.
The economics coming from this project, it's a $1.6 billion net asset value with a 23% IRR. So what we've demonstrated is this nickel deposit is of not only is it economically viable, but it's strategically important to the West. When you look at nickel right now, it's very similar to rare earths in terms of where the supply chain is concentrated. Indonesia controls about 70% through their Chinese companies, about 70% of the nickel supply chain. That's a big problem for the West. It's a big problem for the U.S. So what you'll see in some of the announcements we've done, you will see that we are working very closely with the United States through the Development Finance Corporation, which is their platform. It's basically their investment conduit for the U.S. to invest globally.
And with the additional attention that the U.S. DFC is getting, they're expanding their capabilities right now to go into additional projects with a very big focus on supply chain security. So you'll see previous announcements we've made over the past year where we're working with them. So we've got engagement with the U.S. DFC on project financing. So that's a process underway right now. We have Soc Gen running that process. And then we are also applying for political risk insurance, which is in the final rounds of the application. So that political risk insurance is another interesting product. What that does is that basically provides the larger investors into the Kabanga project, basically underwritten by the U.S. government.
So especially for big projects in emerging markets where investors might be more skittish than if they were here domestically, this is one of those enabling products that really the big institutional investors very much like. So we will be one of the few projects that has been supported by that product. So that's a very big endorsement by the U.S. government. So I think you can see by just some of these announcements we've made, the relationship with the U.S. government, how we're kind of progressing as a company. The Kabanga project, we are raising right now $500 million for the equity and then $800 million for the debt financing. So we have banks engaged. We've got Standard Chartered engaged on the 500. That's in a very advanced stage. So we've narrowed that down to final partners that we would bring them in as new partners in the project.
Then on the project finance side, that's being run by Soc Gen out of Europe. So they're being run in parallel with the intent to get to a final investment decision in Q2 next year. This is a very big project. We're very advanced in the funding. Now, when it comes to Lifezone Metals, I think what's fascinating and a little hard to figure out sometimes, we delivered very, very strong economics for this project. We're very advanced in the funding of this project, but none of that value has really accrued to our stock price. So I think Lifezone Metals, we're really kind of a wait-and-see type story, which is from an investor standpoint, I understand, but the attractiveness to look at us as we are a world-class top-tier nickel project. We compete with Indonesia.
We have had continual announcements on being endorsed by the West and supported. We have a very, very big catalyst coming when we make the announcement on which partnership we bring in in terms of the equity into the project level, so to be clear, that will be brought into the Kabanga Nickel Project, but that value should reflect in our stock price, and that should have a meaningful impact, and this is all just related to capturing the inherent value or intrinsic value of the Kabanga project into our share price, which will come. And this doesn't give any value to our Hydromet Technology where we're going to be deploying that to a number of other projects going forward. I mean, really, we should be able to replicate the processing and the hydromet flow sheet engineering design, all the work we're doing on Kabanga.
Our growth strategy is to basically provide that to a number of other projects going forward. So we would basically do that for royalty. So we become basically a technology company as we kind of transform. So why don't I kind of stop there, Michael? I mean, I would love to answer a bunch of questions, so I wanted to leave proper time for that. But I can go in a few different directions if people have specific questions on anything.
Well, terrific. Thank you, Chris. Again, folks, if you have questions, please type them into that Q&A box, and I'll read them out as they come in. Maybe in the meantime, I could ask a couple, Chris. I studied your recent investor presentation, and a couple of things stood out to me. Kabanga will be an underground mine, yet from that chart you have, it ends up in the first quartile for costs. And so I'm wondering what factors are responsible for a low cost of production like that.
Yeah, no, it's a good one. What you see right now in the nickel industry, the way Indonesia has been able to really dominate in such a short span of time, what they're doing is these islands in Indonesia, they basically clear-cut. I mean, they're clear-cutting rainforests, but they're basically stripping the top layer. So it is a very cheap mining methodology. But those are a different form of nickel called laterite. So it takes additional processing. So what they do is they strip the land. They use high-pressure acid leaching, which is a very specific type of processing. And then that goes through further into the traditional kind of smelting and refining. Now, that's lower grade, which is really the answer to your question. The Kabanga Nickel Project is in a superior category in terms of grade.
So right now, when you look at a nickel equivalent or a copper equivalent, if we were a copper company right now, we'd be the equivalent of 4.1% copper, which would be one of the largest, although one of the highest-grade copper companies in the world. Right now, in our feasibility study, we're just at 2% nickel, which is exceptionally high. So if you look at some of these projects in North America, especially a number of these potential mines in Canada, a lot of these projects are around 0.2%-0.3%, whereas we're sitting at over 2%. So exceptionally high grade, which puts us in that kind of world-class category. And that's really the driver. And when you sit on the cost curve below Indonesia, you're insulated from all the price fluctuations. So Indonesia, where nickel is, they've flooded the market. Nickel's bouncing on kind of all-time cyclical lows.
But even the Indonesian companies now are close to going in the red. So probably 40% of their companies are operating at a loss. So we're really at the bottom in terms of where nickel prices are at around $14,000-$15,000 per ton. Our all-in sustaining cost from the definitive feasibility study is $7,800. So we can produce an all-in sustaining cost, $7,800 per ton. So nickel at $14,000-$15,000, it works right now. So nickel prices recover in the future because a lot of nickel mines have closed in the West, especially in Australia. In two to three years, when you see nickel go into a deficit, right now it's in an oversupply, but we'd be poised to be coming online right when that scenario of the nickel market, excuse me, turning is a reality.
Okay. We've had a couple of questions come in. One person wanted to know how much of the project is controlled by the government of Tanzania.
Yep. So what has happened is about five years ago, Barrick Gold set a precedent when they did a big renegotiation with the Tanzanian government. And they shifted away from being so the mining industry shifted away from just being a payer of taxes and royalties, where you're always kind of fighting the tax authority, to a partnership model. And this was trailblazed really by Mark Bristow. And the partnership model brings the government as an equity participation equity partner. So the government of Tanzania has at the project level, which in Tanzania, our platform there is called Tembo Nickel, the government has a 16% free carry. And that's by regulation. So what we do is we basically have them in as a representation on the board. We work very closely with the government. They are now, as a partner, they want to see the project succeed.
The good thing in Tanzania is this is one of the most important strategic projects in the country. So we get a tremendous amount of support from the president and the government. But it has really evolved into this partnership model where there is a lot of interaction with the government, which is good. It's a better model going forward.
What are some of the milestones we should all watch for in 2026 as you march toward producing metal?
The biggest milestone coming up, and I think for us as a company, there's a very, very large catalyst coming that we've been very open and we've announced to the market. These two processes I mentioned, the key one with Standard Chartered, who's running the equity process, the $500 million capital raise will be a very big defining announcement that we'll be making to the market. And we've publicly announced that we're getting to really the finalist round of that. That's going to be a very, very important milestone. That will lead us to the FID process, so the final investment decision, to the Lifezone Board and to the new investors. And we would be getting to that around Q2 next year. So very big announcements coming.
And I think when the market sees the quality of the partners that we're going to be bringing in, it's going to be a very, very strong endorsement to the story. And I think there'll be a what I would like to assume market efficiencies, you'll see the ability for the stock to value the Kabanga project specifically in a much more efficient way.
Terrific. If we could just turn briefly to the technology side of your business, you have a recycling project where Glencore is a partner. How is that going?
Yeah. Obviously, Kabanga gets all the attention. Sometimes a lot of our core shareholders want me to just talk about nickel. You're a nickel project, and that's going to be the most important thing investors hear. But it doesn't do justice to the actual technology side of what we have. We have over 120 global patents in hydrometallurgy. And there's a number of pipeline projects that we're working on where we are going to be able to commercially deploy this expertise and this know-how. And the partnership we have with Glencore is a great example. A lot of our expertise was really commenced in the PGM sector in South Africa. And so a lot of our patented technology centers around platinum group metals, so platinum, palladium, and rhodium.
What we've done with Glencore is we've been able to take that expertise in the South Africa market, where you have a very large concentration of the world's biggest platinum mines, and apply that to recycling of catalytic converters. So I think everyone has probably seen stories where someone's sitting at a McDonald's and their muffler gets stolen out of the parking lot. There's a good reason for that. That muffler, that catalytic converter, has about 2,000 grams per ton on average of platinum, palladium, and rhodium. So it is the single most valuable component in the car. And what you can do is you can basically open that catalytic converter up, and you can shake it, and the dust that comes out is a massive amount of platinum, palladium, and rhodium.
And so what we're doing is taking that and utilizing our Hydromet Technology to process to final refine metals domestically in America in one site. So the recycling market for catalytic converters is very, very well established, very unlike battery metals recycling, which is really in its infancy. But recycling of catalytic converters, this is an opportunity to really, for a capital cost of one of these plants, and we're doing the final piloting right now at our labs in Australia, one of these plants is going to be about $30 million. And you would be able to produce just about 200,000 ounces per annum of platinum, palladium, and rhodium from that $30 million recycling facility. If you had to replicate 200,000 ounces, you'd have to basically own or build a $1 billion mine in South Africa, which the capital intensity comparison is unbelievably stark.
So for us and for Glencore, Glencore has a huge strategic focus on recycling, and they have been keen to get into PGMs. So it was a very easy partnership. We're 50/50 partnered with Glencore right now on this, co-funding the piloting while we'll commence the build-out early next year. So for Glencore to be able to get into PGMs, to not have to own a mine in South Africa, and to really be compatible with how they're looking at recycling. And this is something that's scalable. It's replicable. We've got two locations picked out in the U.S. so far. And these $30 million hydromet recycling facilities, we can do them geographically. We can replicate these, put them in Europe and other geographies. So for us, it's really exciting. It's the quickest-to-market representation of our hydromet expertise being commercialized.
Kabanga is a huge project, but these are some of the smaller pipeline projects we have where we want to provide these kind of new innovative processing solutions backed by our hydrometallurgical expertise, and while Kabanga gets all the attention, this is going to be a story that I think people will really, really like once we go into that decision phase in January.
Will the recycling technology that you've developed work for other metals that are attractive, things like copper and aluminum?
So, in terms of our hydromet expertise, a lot of it, I guess the way I can describe it is the areas where we have the most competitive advantage are going to be, say, an ore body that is what we call polymetallic, which has not only one metal, but say it has five metals in there. Now, the traditional smelting route, if you're going to focus on a metal, usually you're going to focus on one of those metals which has the highest contained percentage. And when you run that through a smelter, a lot of those other metals get burnt off. They get thrown out with a slag. So it's not as efficient.
Now, where hydromet has the ability to really differentiate itself from an economic standpoint is the ability to liberate and separate multiple metals within an ore body or an ore and keep the recovery percentages very high so that you can capture the economic value of not just one or two of the metals, but all the contained metals. So that is one area we look at, and then also the other competitive advantage is a lot of times smelters, there's a series of nasty elements that they really can't take, so high levels of arsenic, high levels of chromite, high levels of silicon carbide or silica, those all blow up furnaces.
So ore bodies that have high contained levels of what they call deleterious materials, it might be a great mine and a great grade, but it just has too many nasty elements that it can't go into the traditional pyrometallurgical smelting route. Those are areas where we compete. So that's on the mine. And on the recycling, we're doing R&D right now on some rare earth recycling, which is very unique. We're really excited about that. We do all sorts of other metals. Antimony, we're working on a project. We're going to be doing some piloting for a third party. And then really, for us, the core focus is on precious metals. So we have a series of patents in gold. So we have a cyanide-free gold processing process that we're looking to target.
So yeah, I guess to answer your question, there's a whole host of different commodities and types of areas where we can commercialize and deploy our expertise, so for us as a company, we're just getting started, so we have a whole host of metals out there and projects that we can be part of, and that's our growth potential.
Okay. Great. A couple more questions came in about Kabanga. I know Tanzania is building out some rail infrastructure to support the mine exporting through the port, Dar es Salaam. So how is that build-out going? And a related question on whether there is a labor supply near the mine and how that will be handled.
Yeah. That's a good question, actually. So the first question, so Kabanga was discovered. I mean, Kabanga is a giant, but it's been around since 1975. I think the UN Development Programme discovered it. So people have known of this massive nickel deposit for decades. And the challenge of getting it really developed was, well, low nickel prices historically. This is before really the battery revolution and electric vehicles and battery storage. So the infrastructure to access Kabanga was the challenge. So Kabanga is located in the northwest of the country. So road and rail have always been a limitation, as well as power. Now, fast forwarding, Tanzania over the past seven years has made a massive investment in infrastructure. So the standard gauge rail is halfway built across the country.
It's up and running all the way from Dar es Salaam to Dodoma, which is the capital city, and then from Dodoma up to Lake Victoria. That line is probably 85% done. So you have brand new rail infrastructure being installed. We have an access road to the rail siding. So we will be accessing. We'll truck for maybe it's about 280-300 km. And then we'll be able to access the brand new rail, which is great because that would take 1,200 km to get to the port in Dar es Salaam. So this new brand new standard gauge rail is going to give us the ability to really enhance the economics.
In addition, Tanzania, with their power development, the new Nyerere Hydroelectric dam, Tanzania essentially right now is producing almost twice as much power as it consumes, which for an emerging country like Tanzania, that is a phenomenal situation. To be a high-growth country, their growing GDP over 6%, and to have all the power in-country to be able to really back that industrialization and economic development, that's a big deal. Infrastructure development has really been one of the enabling catalysts for the Kabanga project. The second question, in terms of labor, that's a good question because we're all the way in the northwest. This is a very remote area of Tanzania. There's no real large-scale economic activity out there. We will have a massive impact on this part of this Ngara province.
The labor, the good thing, Tanzania does have a very established mining industry, so you have Barrick Gold, you have Anglo, you have Perseus, so you have a very established mining industry, so a pool of labor and talent that we can pull from, but we will have to bring people to the mine site, so we'll do a traditional kind of remote project, you'll be really kind of several weeks in, one week off, so we will be bringing people in from other areas in Tanzania where the mining expertise exists, but that will be something we'll have a lot of attention to, especially when we do further downstream on the processing and refining in country, that's a very, very skilled expertise, and so we would be bringing specialists in, but training up Tanzanians as we go.
You mentioned training up Tanzanians. I know Tanzania has made a big effort to upskill the whole country. I know it's out of ways, but would you consider refining in Tanzania instead of exporting ore or exporting nickel?
Yeah. So what we proposed and what we're working on with government right now is kind of a staged pathway. So really, we want to get the mine up and running first while we finish the additional studies for the processing and refining. So it's a two-stage project with the mine being built first, exporting for only a limited period. And then essentially what you want to have is you want to have the downstream coming online when the mine is ramping up its production. So by the time you have any downstream feed, well, feeding into the downstream processing, you want to have max capacity. You don't want to have idle capacity in any downstream operation. So we're looking to time it. So we'll be only exporting for a limited period while we do step one, get the mine built, step two, go into the further downstream.
So the hydromet processing would produce most likely either nickel sulfate or nickel powder or potentially cathode. So those are all the things we're looking at right now. Really, on the downstream, we want to customize it to what is going to be the most in-demand product in the market at that point in time. So we're talking to a lot of the different off-takers to really customize and decide which we could be really targeting within that processing facility for final product.
One other question just asked us to kind of size the project on a relative basis. I'm pretty sure from what you've said it would be in the top 10, but where does it fall in terms of other nickel mines once it's opened up and producing?
Yeah, that's a good question. So we are going to be doing 3.4 million tons of what they call run-of-mine. That would be producing upwards of 300,000 tons of concentrate at 18% grade. That puts us, I mean, we would be firmly in the top 10, and especially when you look at how many mines in Australia have shut. So you have all the capacity in Australia that's shut because of the oversupply in Indonesia. So what we're really poised to do is be one of the most sought-after, attractive sources of non-Indonesian, non-China-controlled nickel. And that's why we have a lot of attention from Western partners. In terms of final products, when we go downstream, we will be producing in terms of metal units, I think we would be producing somewhere around close to 50,000 tons of nickel metal per annum.
We'd be producing around 6,000-8,000 tons of copper and about 4,000-5,000 tons of cobalt. So if you look, our cobalt production, if we hit peak production of around 5,000 tons of cobalt units, the U.S. demand for cobalt right now is around 8,000 tons. So in terms of sourcing not only critical nickel, you would be really solving more than half of the U.S.'s cobalt supply chain issues. And a lot of the cobalt comes out of the DRC right now where you have artisanal mining, and it's not ideal. So we're non-DRC, non-Indonesian nickel and cobalt, which is of real strategic importance to the Western supply chains.
You mentioned that some of the Australian nickel mines got shut in just due to the pricing environment. And maybe I'm phrasing it too candidly, but sometimes China has used predatory pricing to cause Western producers to shut in, and then it's expensive to open it up again. So they kind of have control over the market that way. Do you see the possibility of that here in nickel and its impact on your mine?
Yeah. And to be very kind of blunt as well, I can't see an environment where the Australian mines can justify restarting, not in the near term. So I think that production is going to stay offline for quite a period. A lot of those mines, when you look at the nickel cost curve, a lot of those mines sit firmly in the upper right, and they have to have, I mean, I know, and you can look at BHP's public announcements. I mean, they need their portfolio of projects in Nickel West, they need somewhere around $22,000-$23,000 per ton of nickel to break even. And that's just a break even, not even the cost of restarting those mines. So very, very high on the cost curve, which puts a massive amount of limitations on them because the Indonesians, they really are a one-country cartel in nickel.
If you are not below them on the cost curve, then it's very difficult. The nickel mines in North America, the big ones in Canada specifically, are 0.2%-0.3%. I mean, you do have very large nickel deposits up there, but with Kabanga being north of 2%, grade is everything. So it's in Indonesia and China's best interest to keep the nickel prices low, but not put them high enough where the West would be able to restart mines. I mean, that's just the simple formula that's playing out right now. So that's why Kabanga is so unique and so strategic. It's because of the high grade and how it's one of the only mines that can compete against the Chinese-controlled 70% of the nickel market.
Okay. Maybe time for one more question. You mentioned that in early 2026, we would be expecting an announcement from you related to some financing news. If all that comes to fruition on that timescale, when do you think you'll be producing metal?
We have kind of indicated that once we reach FID, we'd be looking at two and a half approximate years from FID. So I think if we reach Q2, middle of next year, we'd be looking towards back end of 2028 just as a guidepost. Once we get to FID, we'll be able to give definitive timelines, but just as a range. So we would be really the only large new nickel project to come online within that timeframe.
Interesting. Well, thanks very much. You've given us a lot of information, and I really appreciate that. We have come to the end of our time. So thank you, Chris, for joining us, and thank you, everyone in the audience. See you next time.
Great. Thanks, Michael. Appreciate it.
Okay. Bye-bye.