- New resource estimate underway in Idaho Cobalt Belt’s Iron Creek Project
- First Cobalt assessing need to restart and expand North America’s only currently permitted cobalt extraction refinery
- Scarcity concerns have fueled rise of cobalt’s price on London Metal Exchange from $22,000 per metric ton in 2016 to $90,000 now
The 19th century rush for easy gold led to Idaho’s establishment as a U.S. territory, but, in the modern era, the gem state is known for a variety of important natural resources that may not glitter as much as the yellow ore. Among those resources, diamond extraction led to the parallel establishment of the rich Idaho Cobalt Belt, a unique example of seal-floor hydrothermal brines that comprise a distinctive geochemistry (http://nnw.fm/EU58h), as well as a new alternative to Africa’s conflict-mineral production for the high-tech battery market. First Cobalt Corp. (TSX.V: FCC) (OTCQX: FTSSF) is preparing a new resource estimate on its promising property within the belt to replace the historic estimate (non-compliant with NI 43-101) of 1.3 million tons grading 0.59 percent cobalt (http://nnw.fm/cUwF5).
Cobalt is a critical low-heat element of the lithium-ion batteries that fuel smartphones, laptops and a burgeoning market in electrical vehicles sought as an environmentally friendly alternative to petroleum-driven cars. Reuters recently reported that cobalt supply and demand were in balance last year at about 100,000 metric tons, drawing on an analysis by Swiss investment bank UBS. However, Reuters also noted the brokerage’s prediction that at least 90,000 metric tons of additional cobalt will be needed to meet demand by 2025, while citing Benchmark Mineral Intelligence’s prediction that electric vehicle demand could lead to a deficit as soon as 2022 (http://nnw.fm/dDTW7).
The global fleet of electric vehicles grew by 54 percent last year, and, while electric vehicles still represent only a tiny fraction of the overall auto market, social consciousness and governmental efforts to fight pollution are driving ambitions for the EV market. California has announced plans to have 5 million electric vehicles on its roads by 2025, with a sales target of 15.4 percent EVs that at least eight other states are adopting (http://nnw.fm/UbZP1). China is aiming for two million EV sales by 2020 (http://nnw.fm/yY6Tv), and European countries such as France and Britain are aiming to end the sale of fossil-fuel vehicles altogether by 2040 (http://nnw.fm/dZs8C).
The industry’s rising need for cobalt has caused prices to boom. Its value on the London Metal Exchange grew from $22,000 per metric ton in February 2016 to more than $90,000 per metric ton currently. First Cobalt’s Business Development Vice President Peter Campbell told Reuters that companies concerned about their supply chains are talking to junior mining companies such as First Cobalt that are as much as six years away from production.
First Cobalt’s exploration project in Idaho and an additional one in Canada’s famed Cobalt Camp mining region position it well to also take advantage of conflict metal concerns surrounding the reported human rights violations in the Democratic Republic of Congo’s cobalt-rich mines, which currently supply about two-thirds of the entire cobalt supply worldwide. First Cobalt owns the only currently permitted cobalt extraction refinery in all of North America capable of producing battery-grade material, and its recent acquisition of US Cobalt Inc.’s full shares portfolio (http://nnw.fm/JZ4tZ) further solidifies its profile as a vertically integrated pure-play cobalt company rooted in North America.
“A new resource estimate (of the Idaho Iron Creek Project) is underway based on 2017 drilling and the success of that drill campaign was key to our decision to acquire US Cobalt,” CEO and President Trent Mell informed investors in a news release. “We have now commenced a more ambitious drill program aimed at doubling the strike length of the known cobalt mineralization to 900 metres by the end of 2018, which will support an updated mineral resource estimate and provide us with a better understanding of the size of potential future operations.”
The company recently began studying the variables in play to restart and expand the cobalt extraction refinery near the Cobalt Camp exploration site in Ontario, Canada. The facility “has been in a state of care and maintenance” for the last three years, Mell wrote. Its proximity to the company’s 100 square kilometers of potential exploration sites in the camp and accessible transportation routes give it a valuable pipeline for its own projects, as well as third-party contracts.
“Early in our 2018 drill program, we identified a mineralized zone near Kerr Lake that now extends for over 350m. The goal is to assess near-surface mineralization that could be amenable to open pit mining. These are early days for a mining camp that has been largely forgotten for over 60 years and the upside potential from this camp is significant,” Mell reported. “The refinery is key to realizing early cash flow opportunities and we continue to assess our options for this asset. … As a shareholder, my goal is to make First Cobalt the “go to” name for exposure to the cobalt space.”
This month alone, insiders including two independent directors, John Pollesel and Garett Macdonald, and CEO Trent Mell have together added more than 160,000 shares to their personal portfolios (http://nnw.fm/kCB7t).
For more information, visit the company’s website at http://nnw.fm/FTSSF
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