Scandium is used in alloys for the aviation, weapons, energy, and space industries. It has been declared a critical mineral by the Australian and US governments along with the European Union.

It is added to aluminium to significantly improve the tensile strength of the metal.

Australian Mines partnered with Deakin University last year to investigate ways of optimising the scandium recovery at its Sconi mine in North Queensland.

Under the nine-month joint research program, Deakin applied artificial intelligence to find ways to extract scandium from ore.

It is well documented that separation of scandium from ore host rock is difficult and has led to the scandium price spiking to more than US$7000 per kilogram.

This access has limited supply, and thus adoption, of scandium for industrial applications.

However, Australian Mines and Deakin have declared their research programme a success and claimed they can extract scandium oxide from the Sconi mine at a commercial scale.

Phase 1 of the project identified scandium-aluminium alloys with the potential to supply industrial users and the energy industry.

"Our work with Deakin University to develop new scandium-enriched aluminium alloys aligns perfectly with our strategy to maximise the value that can be generated from the output of the Sconi project," Australian Mines managing director Benjamin Bell said.

"The Sconi project has the potential to be a long-term, globally significant supplier of high purity scandium as well as battery grade nickel and cobalt chemicals to the electric vehicle and energy storage industries, when at full production."

Australian Mines and Deakin are proceeding with a commercial pilot project.

Phase 2, the pilot, will leverage further academic expertise from Deakin to extract scandium-alloys at a commercial scale.

Australian Mines will retain a patent on any successful trial alloys.

The federal government has provided $50,000 to Australian Mines to conduct the pilot project.

The Sconi mine is expected to produce more than scandium, with output of 1.4 million tonnes of nickel sulphate and 200,000t of cobalt sulphate.

Australian Mines expect this to bring in more than $13.3 billion in revenue over the life of the mine.

The Australian Securities Exchange-listed company aims to invest $1 billion into a commercial battery metals production site at the Sconi site.

The plant would process 2 Mt of ore per year.