The company on Friday told shareholders that a review of the carrying value of the Sunrise project was undertaken based on a conservative best estimate of what the probable project execution plan (PEP) outcomes would be, as well as highly conservative macroeconomic assumptions, including the forecast metal process.

Clean TeQ has been progressing the PEP, which will include an update to the 2018 definitive feasibility study for the project as well as a revised master schedule. As the PEP has progressed, a number of trends have emerged, Clean TeQ said on Friday, including an upward pressure on the capital cost estimate of the project.

The expected higher capital cost of the project has also impacted negatively on the carrying value of the asset.

Furthermore, Clean TeQ was also unable to secure a development partner, and commit to a final investment decision by mid-2020 as planned, with the company telling shareholders that the Covid-19 pandemic had presented difficult conditions for financial markets and challenges for funding new projects.

The negative impact of the anticipated longer development timeframes for the project have also been taken into account in assessing the carrying value for the project.

However, given the strong outlook for nickel and cobalt demand, the company remains committed to developing the Sunrise project, once funding has been secured.