[ferro-alloys.com]Canadian junior Midland Exploration (TSX-V: MD) said on Monday it had struck a new funding deal with a subsidiary of BHP (ASX, LON, NYSE: BHP) for nickel exploration activities in northern Quebec.

BHP’s unit Rio Algom Limited will fund 100% of Midland’s exploration for the battery metal within the Nunavik territory up to C$1.4 million ($1.06 million), on an annual basis, for a minimum of two years.

The objective, the junior said, is to identify, test and develop high-quality exploration targets towards the discovery of new significant nickel deposits within the targeted area.

Midland also said BHP may propose additional exploration work for up to C$700,000 before advancing an identified project to the second phase.

The deal comes only weeks after Tesla (NASDAQ: TSLA) boss Elon Musk promised miners a “giant contract” to any firm able to extract nickel for the batteries that power his company’s electric cars in an “efficient, environmentally sustainable manner.”

The BHP-Midland deal could potentially be an answer for the world’s most-valuable carmaker’s needs.

Analysts argue that Musk may have to rely for now on supply coming from the world’s largest producer of the metal: Indonesia. Companies operating there, however, are being criticized for plans to pump waste into the open sea, meaning Musk and other EV makers may need to compromise on sourcing standards while trying to compel the industry to clean up its act.

“Nickel projects being built in Southeast Asia will rely on coal, fuel oil or diesel to run their operations and will leave a very large carbon footprint,” said Sam Riggall, chief executive officer of Clean TeQ Holdings Ltd., which is developing an Australian mine to supply nickel for vehicle batteries. “This sort of makes a bit of a mockery of driving a green, sustainable car,” he told Bloomberg News.

Junior Canada Nickel (TSX-V: CNC) also has its eyes on the price. The junior said in July it had found a way to mine nickel without spewing tonnes of carbon into the atmosphere.

The company is in the midst of setting up a facility near Timmins, Ontario, that CEO Mark Selby said can extract the metal virtually carbon-free.

Canada Nickel plans to create NetZero Metals, a wholly-owned subsidiary, to use existing technologies in the production of zero-carbon nickel, cobalt, and iron products.

Copper, the other favourite

Rio Algom and Midland inked last year another funding deal through which the mining giant would support the Canadian junior’s exploration for copper in the same area. That included work at Midland’s Mythril copper-gold-molybdenum-silver project in James Bay Eeyou Istchee.

As part of that agreement, BHP gained the right to participate in future financings to maintain its pro rata non-diluted ownership stake or increase its ownership to a maximum of 19.99% on a fully diluted basis.

Midland has various partnerships and option agreements on many of its projects with industry heavyweights, including Agnico Eagle Mines (TXS: AEM; NYSE: AEM), Teck Resources (TSX.TECK.A; NYSE: TECK), IAMGOLD (TSX: IMG; NYSE: IAG), Osisko Mining (TSX: OSK), Altius Minerals Corp. (TSX: ALS), Soquem, Nuvavik Mineral Exploration Fund and Abcourt Mines Inc. (TSXV: ABI)

(Mining.com)

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