Blackstone Resources AG (SWX: BLS) is pleased to announce that First Cobalt has announced positive feasibility study results for their cobalt refinery. First Cobalt is an important investment interest in Blackstone's battery metal mining portfolio.
Strong demand for onshoring cobalt supply in North America
According to Benchmark Mineral Intelligence, there are no plans to commission new cobalt refineries outside China, other than First Cobalt. At the same time, auto manufacturers in North America have a strong desire to source cobalt sulphate in North America. The report also estimates that cobalt demand from nickel-cobalt-manganese (NCM) batteries used in EVs will increase from approximately 20,000 tonnes in 2019, to over 730,000 tonnes in 2040. This places First Cobalt in a very strong position. The company has, therefore, attracted considerable attention from investors.
In July 2009, First Cobalt entered into a partnership with Glencore AG to fully fund (in an undiluted manner) a phased recommissioning of First Cobalt's refinery. This agreement was subject to the completion of a positive feasibility study. Glencore plans to use First Cobalt's refinery to treat cobalt feed material supplied from their DRC operations on a four in-a-half year rolling basis. The objective of this project is to produce approximately 25,000 tonnes of cobalt sulphate for the electric vehicle market.
It is estimated that USD 56 million will need to be invested into the refinery, which will deliver an operating cost of an estimated USD 2.72/lb of cobalt produced.
The feasibility study also estimated that USD 37 million in pre-tax cash flow will be generated by the project, during the first full-year of production.
The battery metal supply chain still needs building
The news from First Cobalt is significant, as it represents an important part of the battery market supply chain in North America. Blackstone is in the process of building a vertically integrated battery company that will supply the next generation of battery technology to electric vehicle manufacturers.
To achieve this, its operations have focused on building the supply chain to deliver next-generation solid-state batteries in the global market. This will involve mining battery materials (both from exploration and production projects), refining these battery metals and then using them with the latest battery technology.
First Cobalt's success is a vindication of Blackstone Resource's ongoing investment thesis. The company is very pleased with the results presented by First Cobalt yesterday.
Blackstone Resources AG
Blackstone Resources is a Swiss Holding Company, with its legal domicile in Baar, Kanton Zug and is concentrating on the battery metals market as primary metals. In addition, it sets up, develops and manages refineries used for gold and battery metals. It offers direct exposure to the battery metal revolution that is being driven by the demand of electric vehicles that need vast quantities of these metals. These include cobalt, manganese, graphite, nickel, copper and lithium. In addition, Blackstone Resources has started a research programme on new battery technologies on solid state batteries and its production process.
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