eCobalt Locked & Loaded
The Idaho Cobalt project, wholly owned by Vancouver-based eCobalt Solutions Inc. (TSX: ECS | OTCQB: ECSIF) (“eCobalt”), is set to get busy after C$15m of financing was sourced to advance the late-stage cobalt deposit. The project was placed on care and maintenance in May 2013 due to depressed financial markets and declining commodity prices; today, however, as cobalt shows strong signs of early recovery, its value as the only near-term and fully-permitted primary cobalt deposit in the United States is widely recognised.
Pre-hiatus, all major components of both the mill and concentrator, approximately C$16m of equipment, was purchased and stored in warehouse and staging areas outside of the town of Salmon, close to the millsite. Since lithium-ion batteries were given the nod, the Idaho Cobalt project went from long-term slumber to significant head-start, newly able to make good on the rapidly expanding electric vehicle, grid storage, and renewable energy sectors.
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Previous cobalt demand had been contained to the manufacture of super-alloys, but it became clear that the quantities of cobalt sulphate required by emerging battery manufacturers would considerably outperform the needs of the people whose metals must simply be harder than everyone else’s.
Preliminary checks at the site showed that the operation could potentially switch production focus to cobalt sulfate heptahydrate for the rechargeable battery sector, leading to the commissioning of a Preliminary Economic Assessment (PEA) in January 2015 seeking full confirmation. Previous technical results were based on the production of high purity cobalt (HPC) metal for critical applications in the aerospace sector, and the future return to production of HPC remains a viable option, adding a layer of security to the Idaho Cobalt project that is attractive.
eCobalt will ethically produce environmentally sound battery grade cobalt salts, made safely, responsibly, and transparently in the United States. The project is comprised of the mine & mill site near the town of Salmon, and a stand-alone hydrometallurgical facility, for processing concentrates into refined cobalt, copper and gold products, will likely be located somewhere in Southern Idaho. The mine is expected to produce the equivalent of 1,500 tonnes of high purity cobalt sulfate annually over a projected mine life of 12.5 years.
On February 15th, the company announced C$13m in bought deal financing which was extended to C$15m not twenty-four hours later. Closing of the offering is expected to occur on or about February 28, 2017, and, subject to the usual conditions, the team at eCobalt intend to use the net proceeds for advancing the Idaho Cobalt project towards production.
The asset represents a serendipitous stride into fortune; not only has the commodity price itself improved, but the recent additional attention drawn to ethical issues in the cobalt supply chain prompted buyers to seek a more responsibly produced material. Since the Idaho Cobalt project is located far away from any areas of conflict or human rights abuses, we can be confident that eCobalt won’t struggle to shift their wares.
Whether it be the Gigafactory, Canada or China, Idaho is about to be supplying someone with just under 19,000 tonnes of inoffensively produced cobalt sulphate that will eventually find its way into many of our pockets. Its key function in the storage of power is lifting cobalt out of its twitchy sleep and putting it to work; it just takes quite a lot of lifting.
Lara Smith has spent over a decade covering commodity markets. She started her career as a buyside analyst in South Africa where she covered soft ... <Read more about Lara Smith>