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Broken Hill Prospecting Ltd: THE INVESTMENT CASE
INVESTMENT OVERVIEW

Cobalt Blue Holdings earns 70% beneficial interest in Thackaringa Cobalt Project joint venture

Recent pre-feasibility study confirmed that the Thackaringa project is of global significance as a potential source of high-purity cobalt for the battery revolution.
Sample from Thackaringa Cobalt Project
INVESTMENT OVERVIEW: BPL The Big Picture
Sample from Thackaringa Cobalt Project

Cobalt Blue Holdings Ltd (ASX:COB) has crossed a major milestone by completing the stage II earn-in obligations for the Thackaringa Cobalt Project joint venture in Broken Hill, New South Wales.

Joint venture partner Broken Hill Prospecting Ltd (ASX:BPL) has completed a rigorous review of the stage II deliverables and has formally announced a 70% beneficial ownership for Cobalt Blue over the Thackaringa tenements.

The Thackaringa Joint Venture (TJV), of which Cobalt Blue is the manager, is working on various processing options for an integrated cobalt production strategy.

READ: Cobalt Blue optimising the Thackaringa Cobalt Project

Cobalt Blue is progressing optimisation studies as part of its plan to commercialise the project which hosts an initial ore reserve of 46.3 million tonnes at 819 ppm cobalt.

These studies form part of a bankable feasibility study (BFS) which is following up the recent pre-feasibility study (PFS) which justifies proceeding towards commercial development.

The PFS confirmed that the Thackaringa project is of global significance as a sustainable, low-cost source of high purity cobalt sulphate for the battery revolution.

 

Four major catalysts for Cobalt Blue in the next 12 months, starting in Q4 2018:

• Mine life extension: Substantial potential exists to extend project life targeting inferred inventories from the known resources and from other sources beyond Thackaringa.

A significant drilling campaign will begin shortly with results to be progressively delivered culminating in a new resource model by end of Q1 2019. A 20-year mine life is a vastly superior investment to the current 13-year study.

• Metal recovery optimisation: The company adopted a conservative 85.5% cobalt recovery rate for the PFS (versus an already achieved 88% recovery). Larger scale testing will be conducted during the BFS, incorporating recycle streams, for which a 90% recovery rate is targeted.

Cobalt Blue will be releasing these results by the end of Q2 2019.

• Optimisation of power consumption/pricing: 22% of the site cash costs were related to electrical power. Strong opportunities exist for minimising energy consumption as well as distributed energy generation (solar photovoltaic) to substantially reduce these costs.

• Process plant tailings: A tailings optimisation study will be undertaken with results to be delivered by the end of Q4 2018.

READ: Cobalt Blue Holdings delivers ‘comprehensive PFS that showcases Thackaringa Cobalt Project’

The estimated post-tax net present value of the Thackaringa project is $544 million, delivering an IRR of 22% with a payback period of less than four years.

Importantly, given the capital intensity (US$/tonne cobalt production) of about US$115,000 per tonne, the project is a standout amongst its global peer group.

Cobalt Blue’s strategic focus is on the battery industry and producing a battery-ready cobalt product, cobalt sulphate, at sufficient purity to enter the production chain directly.

This allows the company to sell directly into the battery industry and specifically to cathode precursor manufacturers representing the front end of the industry.

Cobalt Blue’s board and management have a strong track record of attracting partner interest and attracting new capital, particularly due to the processing technology.

This includes a US$6 million investment from LG International, the resources investment arm of LG Corporation, acting in cooperation with LG Chem, one of the world’s largest lithium-ion battery makers.

READ: Cobalt Blue Holdings’ Board confident of funding next stages of world-class cobalt project

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