Australia’s Cobalt Blue has initiated a strategic review of its Broken Hill Cobalt Project (BHCP) in New South Wales, contemplating the viability of a scaled-down operation amid challenging cobalt pricing.
Under current and near-term metal pricing forecasts, Cobalt Blue expects the current size and configuration of the BHCP, as outlined in its 2020 market update, to be unlikely to attract project financing.
The strategic review will focus on a condensed, higher-margin project, the ASX-listed company said on Monday.
Cobalt Blue also announced Iwatani Australia as its potential partner in developing the project, having executed a nonbinding heads of agreement that cements a shared strategic vision for both BHCP and the cobalt and nickel refinery project in Kwinana.
Iwatani is already a potential partner for the refinery.
In terms of the 2020 plans for BHCP, Cobalt Blue planned to produce an average of 3 500 t/y to 3 600 t/y of cobalt, targeting a high-grade cobalt sulphate with 20.5% cobalt content.
“Iwatani Australia is pleased to further engage with Cobalt Blue to develop the Broken Hill Cobalt Project. We see strategic value in developing a large-scale cobalt mine and integrating this feedstock into the Kwinana refinery project,” said Iwatani Australia MD Kan Ueda.
Cobalt Blue CEO Joe Kaderavek said that the companies shared a common view of Australia as a supplier to the global battery industry.