The growing adoption of electric vehicles — global sales doubled last year — has driven up prices of minerals critical to their batteries.
Cobalt is one of those metals rising to US $37 an ounce in 2018 and is still at US $23 today.
An essential element in most electric vehicle batteries, cobalt is in short supply with only 126,500 tonnes mined last year on the globe.
The International Energy Agency predicts demand for cobalt will increase between six to 30 times by 2040. The difference depends on new technology developments for batteries.
Cobalt is a rare mineral with most found as a by-product of copper, silver or nickel mines. Over two-thirds of cobalt production comes from the politically unstable Congo.
Most of the world’s cobalt is refined in China, another politically unstable source.
This Bizworld will review two cobalt companies. Australia-based Jervois Global and Coquitlam, B.C.-based Canada Silver Cobalt Works Inc.
The most advanced is Jervois which has built a four-pronged operation.
Company operations include a cobalt refinery in Finland which is doubling capacity, a cobalt-nickel refinery in Brazil, a massive Australian cobalt deposit and an Idaho cobalt mine opening this year.
The mine is the only pure cobalt mine in the United States with copper and some gold by-product.
The Finnish operation produces chemical cobalt products. The Brazilian refinery, re-opening in 2023, has capacity for 25,000 tonnes nickel and 2,500 tonnes cobalt.
The Idaho mine will produce 4.2 million pounds of cobalt annually at a cost of US $7.45 a pounds, 6.3 million pounds of copper and 6,700 ounces gold.
The Australian cobalt deposit has indicated and inferred resources of 134 million pounds of cobalt as well as low grades of nickel and manganese and a lot of iron. This deposit will take time and plenty of drilling to develop a viable mine.
With just over 1.5 billion shares the TSX-listed Jervois trades at 74 cents a share.
Canada Silver Cobalt, located in the Cobalt district of Northern Ontario, is working on three former producing cobalt/silver mines and one gold-copper bearing structure. Past production from the district was 500 million ounces of silver and 30 million pounds of cobalt.
Subsidiary Coniagas Metals has 14 cobalt properties and is developing a green processing technology called Re-20x with a pilot plant testing and design underway.
The Re-220x process extracts metal without any discharge or smelting and could become a valuable asset for mining around the world. The company has plans to spin it off as a separate company in time.
Silver content of the company’s properties is high. Demand for silver is increasing with its use in industry.
Trading at 16.5 cents a share, Canada Silver Cobalt has just under 177 million shares outstanding.
Both of these companies are worth watching for investors interested in either cobalt or silver mining investments.
CAUTION: Remember when investing, consult your adviser and do your homework before buying any security. Bizworld does not recommend investments.
Ron Walter can be reached at email@example.com
The views and opinions expressed in this article are those of the author, and do not necessarily reflect the position of this publication.