CA - Cobalt Miners News For The Month Of February 2023

Summary

• Cobalt spot prices were down significantly for the month, and LME inventory was down for the month. A shift towards LFP batteries has not helped cobalt demand in China.
• Cobalt market news - BMI: Cobalt rout continues into 2023 due to limited demand from consumer electronics, a surplus supply from mines, and high inventory levels.
• Cobalt miners news - Glencore hands $7.1b to shareholders after record profit. ERG to invest US$50m in the Saudi Arabia market in early-stage exploration for battery transition metals.
• Jervois Global Idaho Cobalt Operations commercial concentrate production now expected end of Q1 2023. Electra Battery Materials achieves first plant-scale recycling of black mass in North America.
• Aeon Metals Walford Creek exceptional intercept from Amy West hole WFDH548: 98.0 m at 2.56% recoverable CuEq* (1.54% Cu, 0.17% Co, 1.5% Pb, 0.38% Zn, 0.08% Ni, 37.5g/t Ag). GME Resources changes name to Alliance Nickel Limited and signs non-binding framework agreement for future offtake and project financing with VinES.

Welcome to the February 2023 cobalt miners news.

The past month saw a significant drop in cobalt prices and a steady month of news.

Cobalt price news

As of February 21, the cobalt spot price was at US$15.88/lb , down from US$21.92/lb last month. The LME cobalt price is US$34,760/tonne . LME Cobalt inventory is 143 tonnes, down from the 159 level from last month. More details on cobalt pricing (in particular the more relevant cobalt sulphate) can be found here at Benchmark Mineral Intelligence or Fast Markets MB .

Cobalt spot prices - 5-year chart - USD 15.88 ( source )

Cobalt demand v supply forecasts

BMI 2022 forecast for cobalt - Deficits building starting from 2024

Trend Investing v IEA demand forecast for EV metals ( Trend Investing ) ( IEA )

2021 IEA forecast growth in demand for selected minerals from clean energy technologies by scenario, 2040 relative to 2020 - Increases Of Lithium 13x to 42x, Graphite 8x to 25x, Cobalt 6x to 21x, Nickel 7x to 19x, Manganese 3x to 8x, Rare Earths 3x to 7x, And Copper 2x to 3x

2022 - BMI forecasts we need 330+ new EV metal mines from 2022 to 2035 to meet surging demand - 62 new 5,000tpa cobalt mines (drops to 38 if include recycling)

Cobalt market news

On February 8, Reuters reported :

Cobalt price slump triggers lift-off in futures trading. Cobalt prices have crashed over the last six months with demand growth slowing just as a wave of new supply washes through the market......Cobalt has lost share to lithium as the Chinese EV market in particular pivots towards non-cobalt battery chemistry.

On February 17, Benchmark Mineral Intelligence reported :

Cobalt rout continues into 2023 as prices fall through to mid-February.... due to limited demand from consumer electronics, a surplus supply from mines, and high inventory levels.

On February 18, Bloomberg reported :

General Motors digs into mining business to lead race for EV metals...... The US automaker is competing for a stake in Vale's base metals unit, people familiar with the matter said this month. A deal may give GM access to the Brazilian mining giant's copper and nickel resources that are key to making EV batteries......Last month, it bought a $650 million stake in Lithium Americas to help develop Nevada's Thacker Pass mine......In October, GM invested $69 million in Australia's Queensland Pacific Metals, a producer of nickel and cobalt...... "We'll continue to work with many people in the industry, especially in lithium and the other critical minerals," CEO Mary Barra said.

Cobalt company news

Glencore [HK:805] [LSE:GLEN] ( GLCNF )

On February 1, Glencore announced :

Full year 2022 production report......Own sourced cobalt production of 43,800 tonnes was 12,500 tonnes (40%) higher than 2021 following Mutanda's restart in Q4 2021.

On February 1, Glencore announced : "Cancellation of Treasury shares."

On February 15, Glencore announced :

Preliminary results 2022. "The global pandemic, recovery from it and years of underinvestment, followed by conflict in Europe, exposed pre-existing vulnerabilities in energy security and supply chains, underpinning the generally high and volatile 2022 commodity price environment, which enabled the Group to generate record profitability for the year. "The unprecedented developments in global energy markets were material drivers for both our marketing and industrial businesses, lifting Group Adjusted EBITDA to $34.1 billion, up $12.8 billion over the period. Marketing posted another record performance, with Adjusted EBIT of $6.4 billion, up 73% year on year.....Industrial EBITDA increased by $10.2 billion to $27.3 billion, benefitting primarily from record prices for our key coal benchmarks, amplified by the incremental contribution from the two-thirds of Cerrejón, acquired in January 2022, that Glencore did not previously own.....

On February 15, Reuters reported : "Glencore hands $7.1 bln to shareholders after record profit....."

CMOC Group Limited [HKSE:3993] [SHE:603993] ( CMCLF ) (formerly China Molybdenum)

No news for the month.

Zheijiang Huayou Cobalt [SHA:603799]

No significant news for the month.

Jinchuan Group International Resources [HK:2362]

On February 17, Jinchuan Group International Resources announced :

Operational update for the year ended 31 December 2022.....In 2022, Ruashi Mining SAS, a non-wholly-owned subsidiary of the Company, successfully purchased more high cobalt grading ore from independent suppliers which offsetted the impact caused by the decrease in self-mined ore's feed grade, resulted in the increase in cobalt production volume by approximately 17% to 3,961 tonnes in 2022 as compared to 2021 of 3,379 tonnes. The decrease in copper ore grade in 2022 led to a slight decrease of 3% in copper production in 2022 to 59,440 tonnes as compared to 61,260 tonnes in 2021.

Chemaf (subsidiary of Shalina Resources)

No news for the month.

GEM Co. Ltd. [SHE:002340]

No news for the month.

Investors can read more about GEM Co. in the Trend Investing article: " A Look At GEM Co Ltd - The World's Largest Battery Recycling Company " when GEM Co. was trading at CNY 5.08.

Eurasian Resources Group ("ERG") - private

ERG own the Metalkol facility in the DRC where ERG processes cobalt and copper tailings with a capacity of up to 24,000 tonnes of cobalt pa.

On January 25, Eurasian Resources Group announced :

Eurasian Resources Group enters the Kingdom of Saudi Arabia, plans long-term investment......ERG plans to invest US $50 million in the market, with the potential to increase this number year-on-year......ERG will prioritise large scale, tech-enabled early-stage exploration for battery transition minerals in the Ad Dawidimi region of the Kingdom, where it has already secured licenses and is actively pursuing further exploration ground.

Umicore SA [Brussels:UMI] ( UMICY )

Umicore state : "We are a worldwide leader in the recycling, refining, transformation and marketing of cobalt and nickel specialty chemicals."

On February 13, Umicore SA announced :

Umicore starts industrialization of....its leading manganese-rich HLM (high lithium, manganese) cathode active materials ((CAM)) technology and targets commercial production and use in electric vehicles (EVs) in 2026. This major milestone introduces a distinctly competitive technology to other design-to-cost battery technologies for EVs and complements Umicore's broad portfolio of NMC (nickel, manganese, cobalt) battery materials for high performance, long-range EVs......HLM offers a better total cost of ownership than LFP (lithium iron phosphate) with longer driving ranges, equivalent safety, much more reliable SOC (state of charge) monitoring and better recyclability.

On February 16, Umicore SA announced : "Full year results 2022." Highlights include:

• "Revenues[1] of € 4.2 billion (+10%).
• Adjusted EBITDA of € 1,151 million (-8%) and adjusted EBITDA margin of 27.3% (compared to 32.5% in 2021).
• Adjusted EBIT of € 865 million (-11%).
• EBIT adjustments of - € 32 million.
• ROCE of 19.2% (compared to 22.2% in 2021).
• Adjusted net profit (Group share) of € 593 million and adjusted EPS of € 2.47.
• Cashflow from operations of € 835 million (vs € 1,405 million in 2021); free cashflow from operations of € 344 million (vs € 989 million in 2021).
• Capital expenditures amounted to € 470 million (vs € 389 million in 2021).
• Net debt at € 1,104 million, compared to € 960 million at the end of 2021. This corresponds to a net debt/ LTM adj. EBITDA ratio of 0.96.
• Proposed gross annual dividend for 2022 of € 0.80 of which € 0.55 to be paid in May 2023, with an interim dividend of € 0.25 already paid out in August 2022."

Sumitomo Metal Mining Co. (TYO:5713) ( STMNF )

On February 8, Sumitomo Metal Mining Co. announced : "Supplementary explanation for financial summary 3rd quarter FY2022 [IFRS]."

On February 8, Sumitomo Metal Mining Co. announced : "Consolidated financial results for the third quarter ended December 31, 2022."

On February 9, Market Screener reported : "Sumitomo Metal posts 10% fall in fiscal nine-month attributable profit; adjusts FY22 guidance."

MMC Norilsk Nickel [LSX:MNOD] [GR:NNIC] ( NILSY ) (ADRs to remain in circulation until April 28, 2023 )

On February 10, MMC Norilsk Nickel announced : "Nornickel reports full year 2022 audited consolidated IFRS financial results." Highlights include:

• "Consolidated revenue decreased 5% y-o-y amounting to USD 16.9 billion. Higher nickel and cobalt prices and recovery of production volumes following the liquidation of damages caused by incidents at Oktyabrsky and Taimyrsky mines and Norilsk concentrator were negatively offset by lower copper and PGM prices as well as decline in metal sales volume driven by logistics disruptions and reorientation of sales to new markets that requires additional time.
• EBITDA decreased 17% y-o-y to USD 8.7 billion owing to lower revenue, higher operating cash costs driven mainly by increase in labour expenses and repairs. EBITDA margin amounted to 52%.
• Net income was down 16% y-o-y to USD 5.9 billion mostly driven by lower EBITDA.......
• Economic restrictions imposed on Russia by a group of countries pose risks for operating, commercial and investment activities of the Company. To mitigate these risks Nornickel is developing relationship with alternative clients and suppliers, setting up new logistic routes and exploring new capital markets."

OZ Minerals [ASX:OZL] ( OZMLF )

On January 30, OZ Minerals announced : "Fourth quarter report 2022 for the three months ending 31 December 2022." Highlights include:

Strong Q4 production improvement; Annual Group production and cost guidance achieved.

• "Growth projects advanced: West Musgrave construction commenced; MHP study confirms the technical and potential commercial opportunity of producing a high quality and high grade MHP. Prominent Hill shaft pre-sink completed; production ramp up extended to H2 2025. Carrapateena cave breakthrough. Kalkaroo exploration drilling commenced.
• Entered into a Scheme Implementation Deed with BHP under which it is proposed that BHP would acquire 100% of the shares in OZL by way of a scheme arrangement for a cash price of A$28.25 per OZL share.
• Focus for 2023 is on safe delivery of operational and growth plans, continuing exploration activities to build our organic growth pipeline, implementing our decarbonisation roadmap, strengthening our culture and moving towards realising our Strategic Aspirations."

On February 6, OZ Minerals announced :

BHP's proposed acquisition of OZ Minerals; Brazilian competition approval received. OZ Minerals announces that Brazil's Administrative Council for Economic Defence has provided clearance for BHP Lonsdale Pty Ltd's proposed acquisition of 100% of the shares in OZ Minerals by way of scheme of arrangement ("Scheme"). As a result, the condition precedent regarding Brazilian competition approval has now been satisfied.

Sherritt International [TSX:S] ( SHERF )

On January 23, Sherritt International announced : "Sherritt reports strong 2022 production results and provides 2023 guidance." Highlights include:

2022 Actual

• "At the Moa Joint Venture (Moa JV) finished nickel production was 32,268 tonnes (100% basis), in line with guidance, representing a 3% increase year-over-year primarily due to increased refinery reliability and higher nickel-to-cobalt ratio, while finished cobalt production of 3,368 tonnes (100% basis) was materially within guidance....."

2023 Guidance

• "2023 will be a transition year for the Moa JV.......finished nickel production is forecast to be 30,000 - 32,000 tonnes (100% basis), while finished cobalt production is forecast to be 3,100 - 3,400 tonnes (100% basis)....."

On February 8, Sherritt International announced : "Sherritt reports strong 2022 results, improved balance sheet and receipt of first cobalt swap distribution."

Selected Q4 2022 Developments

• "Sherritt finalized an agreement with its Cuban partners to recover $368 million total outstanding Cuban receivables over five years beginning January 1, 2023 (the Cobalt Swap). Under this agreement, the Moa JV will prioritize payment of dividends in the form of finished cobalt to each partner, up to an annual maximum of cobalt, with any additional dividends in a given year to be distributed in cash......
• Sherritt repurchased an aggregate of almost $90 million in principle of its second lien secured notes and junior notes at a discounted value of $80 million.......
• Cuba's Executive Committee of the Council of Ministers approved the twenty-year extension of the Energas Joint Venture contract with the Cuban government to March 2043.....
• Net loss from continuing operations was $7.3 million, or $(0.02) per share in Q4 2022, compared to net earnings from continuing operation of $14.4 million, or $0.04 per share, in Q4 2021.....

• Net earnings from continuing operations was $63.7 million, or $0.16 per share in 2022, compared to a net loss from continuing operations of $13.4 million, or $(0.03) per share, in 2021 while Adjusted EBITDA(1) for 2022 was $217.6 million compared to $112.2 million in 2021......"

Nickel 28 [TSXV:NKL] [GR:3JC] ( CONXF )

No significant news for the month

Investors can view the company presentations here .

Jervois Global Limited [ASX:JRV] [TSXV: JRV] ( JRVMF ) [FRA: IHS] (formerly Jervois Mining)

On January 30, Jervois Global Limited announced : "Jervois Global Limited quarterly activities report to 31 December 2022." Highlights include:

São Miguel Paulista ("SMP") Nickel and Cobalt Refinery, Brazil:

• "Final Investment Decision approved for refinery restart.
• First production expected end Q1 2024 - refurbishment underway."

Idaho Cobalt Operations ("ICO"), United States:

• "Initial mine development and infrastructure near complete.
• Unprecedented labour shortages and severe winter weather underpins revision to project schedule and cost - commercial concentrate production now expected end of Q1 2023.
• Promising results from recent resource expansion drilling, confirming potential for mine life extension."

Jervois Finland:

• "Q4 2022 cobalt sales of 1,355 metric tonnes.
• Q4 2022 revenue US$73.0 million (FY22: US$353.9 million).
• Q4 2022 Adjusted EBITDA of -US$7.1 million (FY22: US$19.1 million), impacted by higher cost inventory unwind and a backdated assay adjustment from refinery operator Umicore.
• Jervois appoints AFRY to lead Kokkola refinery expansion Bankable Feasibility Study."

Corporate:

• "Financial strength and flexibility enhanced by US$150 million equity raise..
• Jervois ended December 2022 quarter with US$152.6 million in cash, US$112.8 million physical cobalt inventories in Jervois Finland, and total drawn debt of US$215.0 million."

On February 8, Jervois Global Limited announced : "Jervois' in-fill drilling at ICO adds confidence in RAM resource."

On February 10, Jervois Global Limited announced :

Jervois agrees to initial nickel supply contract for SMP refinery.....SMP is expected to restart production at the end of Q1 2024, with initial production forecast of 10,000 metric tonnes per annum ("mtpa") of nickel and 2,000 mtpa cobalt. Jervois continues to negotiate additional refinery feed sourcing arrangements for SMP.

On February 20, Jervois Global Limited announced : "Expansion drilling consolidates RAM deposit extension at Jervois' ICO."

Upcoming catalysts include:

• End Q1, 2023 - Idaho Cobalt Operations to reach nameplate capacity production.
• Q1, 2024 - First production targeted from the São Miguel Paulista Refinery.

Electra Battery Materials [TSXV:ELBM] ( ELBM )

On February 8, Electra Battery Materials announced :

Electra announces US$51 million convertible note offering, intention to repurchase and cancel existing convertible notes and discussions with respect to potential additional sources of funding.....Electra is also in active discussions with the Government of Canada and Government of Ontario, seeking a commitment of up to US$7.5 million (C$10 million) in additional total funding to support the recommissioning of the Company's wholly-owned hydrometallurgical cobalt refinery (the "Refinery") located north of Toronto. The governments of Canada and Ontario have each previously provided US$7.5 million toward the project. The terms and conditions for these potential sources of funding are under discussion and subject to final government approvals, therefore there is no guarantee this additional capital will be provided on terms the Company can satisfy, or at all.

On February 14, Electra Battery Materials announced :

Electra closes US$51 million secured convertible note offering and cancels US$36 million of convertible notes due 2026.

On February 14, Electra Battery Materials announced :

Electra achieves first plant-scale recycling of black mass in North America - Marks important milestone for North America's EV battery supply chain....."Initial results from our black mass trial are extremely encouraging," said Trent Mell, CEO of Electra. "The results validate that our proprietary hydrometallurgical process is able to recover high-value elements from shredded lithium-ion batteries effectively and confirm that the commissioning work we have completed to date has made our refinery operational again after being idle for more than a decade." Mr. Mell added, "These preliminary results represent a significant milestone for the Company and the industry as we believe it marks the first hydrometallurgical plant-scale recycling of black mass in North America and the first recovery of a mixed hydroxide nickel and cobalt product. These results pave the way for us to extend our trial beyond the 75 tonnes we initially planned and maximize the cashflow opportunities generated through the sale of multiple products critical to the EV battery supply chain in North America. We have established relations with black mass producers in North America and abroad to support our continued efforts."

Upcoming catalysts include:

• H1 2023 - Target to have their Ontario cobalt refinery operational with ore feed from Glencore.

Investors can view the company presentations here and a recent Trend Investing article on Electra here .

Possible mid-term producers (2024 onwards)

Sunrise Energy Metals Limited [ASX:SRL]( SREMF )(formerly Clean TeQ)

Sunrise Energy Metals has 132 kt contained cobalt at their Sunrise project.

No news for the month.

Upcoming catalysts include:

• 2023 - Possible off-take agreements and project funding/partnering.

Investors can also read the latest company presentation here.

Ardea Resources [ASX:ARL] ( ARRRF )

In total, Ardea has 5.9mt of contained nickel and 380kt of contained cobalt at their KNP Project near Kalgoorlie in Western Australia. Ardea is also exploring for gold and nickel sulphide on their >5,100 km2 of 100% controlled tenements in the Eastern Goldfields region of Western Australia.

On January 30, Ardea Resources announced :

Kalgoorlie Nickel Project Goongarrie West Drilling Ionic Clay Rare Earth Discovery.....Intercepts of Total Rare-Earth Oxides (TREO) at a 1,000ppm TREO cut-off for the three hole Goongarrie West program were received, with highlights including: AGSA0224, 7m at 3,506ppm TREO from 64m. AGSA0225, 12m at 2,487ppm TREO from 40m. AGSA0226, 4m at 1,181ppm TREO from 56m.

On January 31, Ardea Resources announced :

Quarterly operations report for the quarter ended 31 December 2022.....Ardea remains debt free, with a tight capital structure and $15.3M cash-at-bank to maintain momentum with the KNP work streams.

On February 6, Ardea Resources announced : "Ardea receives $1.8 million R&D Tax Incentive Rebate....."

Upcoming catalysts include:

• 2023 - Possible off-take partner and funding for the GNCP Project. Further potential exploration results including also for lithium, rare earths, and nickel sulphide.

Investors can read the latest company presentation here.

Cobalt Blue Holdings [ASX:COB] ( CBBHF )

Cobalt Blue has 81.1kt of contained cobalt at their 100% owned Broken Hill Cobalt Project [BHCP] (formerly Thackaringa Cobalt Project) in NSW, Australia. LG International is an equity strategic partner.

On January 31, Cobalt Blue Holdings announced : "December 2022 quarterly activities report.....Broken Hill Cobalt Project (BHCP. Feasibility Study update

Work on the Feasibility Study continued during the quarter. Activities included:

• Demonstration Plant operations.
• Feasibility Study engineers progressed mine layout concepts, power and water infrastructure reviews continued.
• Resource, groundwater and waste rock drilling.
• Continuation of soil investigations and ecological studies."

Upcoming catalysts include:

• 2023/24 - Possible off-take agreements. Feasibility Study & project approvals. Final Investment decision. Potential project funding.

Investors can watch a CEO interview here and a recent presentation here .

Australian Mines [ASX:AUZ] ( AMSLF )

On January 30, Australian Mines announced : "Quarterly activities report for period ended 31 December 2022." Highlights include:

• "Sconi Project Studies - Australian Mines announced the strategic decision to develop the Sconi Project producing battery grade nickel sulphate, cobalt sulphate and scandium oxide following a review of recent technical and financial studies. This is to maximise the value of the project and return for shareholders. A pathway to construction for nickel sulphate, cobalt sulphate and scandium oxide is being mapped which will include further technical studies, test work, environmental monitoring, permitting and approval and strategies for project funding as we progress to the Final Investment Decision ((FID)) targeted for the end of 2025.
• Capital Raise and Entitlement Offer - Australian Mines executed agreements with Investors for a combined investment of $4.55 million by way of Share Subscription Agreements, together with the successful completion of a 1 for 9.8 partially underwritten non-renounceable entitlement offer raising approximately $2.8m. The combination of the Share Subscription Agreements and entitlement offer raised a total of approximately $7.4 million with the funds to be applied to project financing activities, bolstering the management team and advancing the Sconi project.
• ASIC Settlement - Subsequent to the quarter, on the 13 January 2023, the Federal Court approved the previously announced agreement between Australian Mines and ASIC to resolve the Proceedings by the Company making certain admissions of contraventions of its continuous disclosure obligations....."

For further details see:

Cobalt Miners News For The Month Of February 2023