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Cobalt Blue discusses Chinese processing co-operation in Proactive Q&A Sessions™

China processes over 50% of the world’s cobalt into intermediates and physical metal.
Cobalt Blue discusses Chinese processing co-operation in Proactive Q&A Sessions™
Joe Kaderavek, chief executive officer, Cobalt Blue Holdings, in China

Cobalt Blue (ASX:COB) is currently undertaking one of the largest drilling campaigns amongst cobalt explorers globally.

This is expected to triple the Thackaringa cobalt resource in coming months.

Looking forward - the company has also taken the proactive step to build relationships with processing centres and end users.

Joe Kaderavek, chief executive officer, has just returned from a trip to China looking at the cobalt processing industry, travelling over 3,000 kilometres by road and rail, and holding discussions across four inland provinces with businesses that represent over 80% of Chinese cobalt capacity.

To tell us more, we welcome back Joe to Proactive Q&A Sessions™.


PROACTIVE INVESTORS: Welcome Joe.


Why is China important to cobalt and COB?

China processes over 50% of the world’s cobalt into intermediates and physical metal.

Our focus was understanding how we can commercially and technically cooperate with these refineries.

Additionally, we are trying to benchmark our processing ideas with industry partners that have over 50 years of cobalt extraction experience.

We can never assume that we have all the answers.

Our view is to build a world class business that is a through cycle incumbent of global supply.


What areas for co-operation do you see?

There are enormous benefits to co-operation, for example deploying best in class technologies to achieve high yield, low cost extraction processes, factors key to our success.

We were very impressed by Chinese research and development efforts, particularly focussed upon cobalt salt production from sulphide materials (such as Cobalt Blue).

Further, plant design and state of the art process control allow for efficient processing of very high material volumes.

From their viewpoint, refineries are looking for diversification away from an increasing dependency on sourcing cobalt from the African copper belt.


Is the cobalt industry concerned by price and what is “cobalt less growth”?

The collective view was that current pricing (approx. US$25/lb) was sustainable, with all industry participants making a good margin.

However, further upward price pressure may cause battery makers to “thrift” and use lower cobalt content cathodes in response.

98% of cobalt is sourced as a byproduct from nickel or copper mining.

Excluding new supply from the Democratic Republic of Congo (DRC), global copper and nickel mine growth is “cobalt less”, with low cost Indonesian and Philippine nickel pig iron and South American copper molybdenum ores not adding to cobalt supply, whilst depressing nickel and copper pricing for new mines that do have cobalt content.

As a result, increasing dependency on DRC cobalt is a concern for the industry.

Our deposit at Thackaringa in New South Wales, is not dependent on nickel or copper pricing, and is therefore very well placed.


What are COB’s milestones?

Cobalt Blue is undertaking one of the largest drilling campaigns amongst cobalt explorers globally.

We are delivering over 8,000 metres of diamond and reverse circulation drilling in conjunction with a Scoping Study due by mid-year.

Looking forward we will be delivering a Preliminary Feasibility Study by mid-2018 and a full bankable feasibility study by mid-2019.

PROACTIVE INVESTORS: Thank-you Joe.

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