A US company developing America's first commercial-scale, solar-powered cobalt sulphate and cobalt metal processing facility, EVelution Energy, has garnered approval from US Citizenship and Immigration Services (USCIS) for its EB-5 investment offering.

The investment offering will support $64.8-million in subordinated project finance, with the EB-5 Immigrant Investor Programme enabling qualifying foreign investors to invest in US projects that create new full-time jobs in return for an accelerated pathway to US permanent residency for them and their immediate family members.

"Capital-intensive critical minerals projects require substantial development funding for engineering, permitting, site development and technical validation before conventional senior project financing is generally available. EVelution’s financing strategy is designed to bridge this development-stage gap by combining EB-5 subordinated debt with equity raised through a dedicated Qualified Opportunity Zone fund," explains EVelution president and CEO Navaid Alam.

He adds that with the USCIS approval now received and the project’s census tract nominated by the State of Arizona for successor designation as a Rural Opportunity Zone under Opportunity Zone 2.0, EVelution expects to be able to raise all of the development-stage capital that it needs to complete the project’s remaining engineering, technical and site-development work.

The company is targeting completion of its bankable feasibility study (BFS) in the first quarter of next year.

Once the project has substantially completed its development activities and advanced toward a final investment decision, the company expects construction financing to come from a separate layer of the capital stack.

EVelution has received a re-issued non-binding letter of interest from the Export-Import Bank of the United States indicating that it can finance up to $275-million of the project’s costs under the Make More in America initiative, subject to due diligence, underwriting, authorisation process and other applicable requirements.

Institutional equity and potential strategic investments are expected to complement that financing.

"The USCIS approval adds a development-stage financing milestone to our previously announced Rural Opportunity Zone 2.0 nomination, export-credit financing initiatives, feedstock arrangements, long-term offtake agreements, solar construction and site-development work.

"Construction of the solar facility started in June and construction of the cobalt processing facility is expected to start next year after completion of the BFS. Commercial operations are targeted for 2029," Alam confirms.

FACILITY RATIONALE

EVelution’s innovative financing strategy is intended to support domestic cobalt processing capacity at a time when more than 75% of global cobalt refining capacity is located in China and the US has no commercial-scale cobalt refining infrastructure.

The project is being developed to address this structural vulnerability and aligns with federal initiatives under the Defense Production Act to rebuild secure domestic processing capacity for materials essential to defence systems, aerospace platforms and next-generation energy technologies.

As demand grows across the defence, aerospace and advanced manufacturing sectors, domestic refining capacity is increasingly important to US industrial resilience and national security.

When fully operational, the facility is expected to produce about 7 000 t of contained cobalt a year, comprising about 4 000 t/y of contained cobalt in battery-grade cobalt sulphate for electric vehicle batteries and about 3 000 t/y of alloy-grade cobalt metal for aerospace, defence and advanced manufacturing applications.

At full operations, the facility is expected to supply up to 40% of projected US cobalt demand.

“The financing challenge for critical minerals projects is not limited to raising the capital required for construction. Projects must first finance the engineering, technical and development work required to become bankable.

“Our EB-5 and Opportunity Zone financing strategy is designed to bridge that gap and advance the project toward the institutional capital required for construction," Alam states. 

The Yuma County facility will be located in an existing Qualified Opportunity Zone on a census tract that the state of Arizona has also nominated for successor designation as a Rural Opportunity Zone under Opportunity Zone 2.0, subject to certification by the US Department of the Treasury. 

The facility is being designed to be solar-powered and operate using a closed-loop water management system that is expected to recycle about  70% of its process water, eliminate on-site process-water discharge and avoid on-site tailings storage or disposal.

At full development, the $450-million project is expected to generate $1.2-billion in yearly economic activity across Arizona and support more than 6 200 direct, indirect and induced jobs over the life of the project.

The facility is expected to attract long-term industrial investment, create skilled employment and strengthen Arizona's position as a center for advanced manufacturing and critical minerals processing.