The company said laboratory tests confirmed recoveries up to 99.5% were possible in producing high-concentration nickel-cobalt chemical solutions, positioning the flagship Decar project as a potentially significant supplier of nickel for both the stainless steel and the EV battery markets.

CEO Martin Turenne hailed the testwork as a breakthrough, demonstrating potential to produce significant quantities of nickel and cobalt in a high-quality form for the fast-growing EV battery supply chain.

"The results further confirm that the awaruite nickel ore at Decar has potential technical advantages over sulphide and laterite ores for producing nickel sulphate and cobalt sulphate. In comparison with nickel sulphide concentrates, the direct dissolution of Decar concentrate can eliminate the need for smelting prior to downstream processing to produce nickel sulphate," he said.

According to Turenne, production of high-grade Decar concentrate feedstock conceptually meant a smaller operational footprint and lower energy (pressure and heat) requirements than HPAL laterite operations.

He said the testing confirmed the potential to produce nickel sulphate and cobalt sulphate from awaruite ore in a simple three-stage process involving ore beneficiation, pressure leaching and solvent extraction.

"This three-stage processing route has the potential to be more efficient than the typical five-stage processes required to convert sulphide and laterite ores into nickel sulphate," Turenne said.

The operating parameters for leaching Decar concentrates into nickel-cobalt solution were potentially favourable because they were based on significantly lower sizing, power consumption, pressure and temperature requirements than typical HPAL operations.

The testwork was undertaken by Sherritt Technologies in Fort Saskatchewan, Alberta, but more work is required to "further evaluate and optimise downstream hydrometallurgical processing requirements".

FPX said it would now undertake internal trade-off studies to define the optimal product mix to be derived from the Decar project for the stainless steel and EV battery markets.

It expects these additional tests to generate nickel products suitable for testing with potential offtakers, with this market evaluation expected to generate collaborative opportunities with nickel market participants.

FPX shares (TSXV:FPX) shares gained 26% or C3.5c on Tuesday to 17c, within a hair of the 12-month high of 18c. The company has a market value of $26 million (US$20 million).