The company will use its proprietary technology to determine whether cobalt from sulphide ore at Havilah Resources’ (ASX:HAV) Mutooroo copper-cobalt deposit can be recovered economically.
Mutooroo is west of the company’s Thackaringa deposit where metallurgical work has identified a potential processing path demonstrating strong cobalt recoveries for pyrite hosted cobalt.
Mutooroo may have similar requirements
The parties believe Mutooroo may have similar metallurgical requirements to commercialise cobalt.
Cobalt Blue will carry out due diligence on the Mutooroo deposit and provide results by 30 April 2018.
Havilah will provide a representative 10 kilogram sulphide ore sample and Cobalt Blue will perform laboratory test work using its technology.
This will include crushing, grinding, flotation, calcining and leaching with the aim of providing a simple proof of the process for Mutooroo ore.
The aim is to demonstrate the ability of the process to perform concentration/flotation, pyrolysis, including production of elemental sulphur, and cobalt extraction into solution.
Cobalt Blue’s test work will not optimise recoveries, which will be the subject of further studies.
Basis for future cooperation
The MOU provides the basis for possible future cooperation between the parties by mutual agreement on a wide range of activities, including marketing of cobalt sulphate concentrate.
It is non-binding, but reflects the willingness of both parties to cooperate.
The Thackaringa project is 23 kilometres west of Broken Hill and 400 kilometres by rail from the port at Port Pirie.
It consists of four granted tenements with a total area of 63 square kilometres.
A prefeasibility study on the cobalt project is due for delivery by mid-2018.
The project area is under-explored, with the vast majority of historical exploration directed at or around the outcropping pyritic cobalt deposits at Pyrite Hill, Big Hill and the Railway deposit.
These deposits comprise 54.9 million tonnes at 910 ppm cobalt, 9.56% sulphur and 10.9% iron for 49,986 tonnes of cobalt.
Potential to expand resource
Potential to extend the mineral resource at these deposits and the other prospects is high.
It has a 51% beneficial interest and subject to the achievement of milestones, will be entitled to acquire 100%.
Broken Hill Prospecting remains the registered holder of the project tenements until the farm-in is complete.