The Elements of Innovation Discovered
The Elements of Innovation Discovered
Metal Tech News - June 16, 2023
Once in production, Jervois Mining's Idaho Cobalt Operation will be the only primary cobalt-producing mine in the U.S.
Anthony Di Stasio
To shore up domestic supplies of the cobalt needed for military hardware and green energy, the U.S. Department of Defense is investing $15 million to support the work of Jervois Mining USA to expand mining at its Idaho Cobalt Operations and potentially establish a refinery in the U.S.
Foreseeing a sharp rise in the demand for cobalt in the United States as automakers make the rapid transition from fossil fuel-burning vehicles to electrified models, Australia-based Jervois Global Ltd., the parent of Jervois Mining USA, acquired Idaho Cobalt Operations in 2019.
The company celebrated a soft opening of the Idaho mine in October of last year and expected to reach commercial production in March. With cobalt prices plummeting from above $37 per pound to just above $13/lb over the past 16 months, coupled with the costs for the goods and services on the rise over the same period, the company was forced to wind down Idaho Cobalt before it even got going.
"Market conditions have required us to make the difficult decision at Idaho Cobalt Operations in the United States where we have paused final construction and commissioning of our processing plant. This was achieved in a safe manner and in compliance with all of our environmental obligations," Jervois Global Chairman Peter Johnston penned in an April letter to shareholders.
Given cobalt's role in the lithium-ion batteries powering electric vehicles and the growing demand being driven by the transition to e-mobility, the price of this battery metal is expected to bounce back.
Top White House and Pentagon officials, however, are less concerned about market dynamics than they are about America's heavy dependence on imports for a strategic mineral that is predominately mined in the Democratic Republic of Congo and refined into a usable metal in China.
A DOD assessment of critical and strategic metals found that cobalt is an ingredient in multiple munitions and high-temperature aerospace alloys used by the U.S. armed forces and has critical applications in high-capacity batteries for military and commercial EVs.
Last year, President Biden sent a memorandum ordering the Defense Department to utilize the estimated $750 million of available Defense Production Act Title III funding to establish and expand upon sustainable and responsible domestic production of strategic and critical minerals.
"The United States depends on unreliable foreign sources for many of the strategic and critical materials necessary for the clean energy transition – such as lithium, nickel, cobalt, graphite, and manganese for large-capacity batteries. Demand for such materials is projected to increase exponentially as the world transitions to a clean energy economy," the President penned in the memorandum.
The Pentagon earmarked $15 million of DPA Title III funding authorized by the White House for helping Jervois expand cobalt mining and refining in Idaho, one of the few places outside of DRC that hosts deposits with the grades needed to support a mine where cobalt is the primary metal.
"In investing in domestic cobalt resources, Industrial Base Policy is building a sustainable, responsible industrial base capable of meeting our future national defense challenges," said Dr. Laura Taylor-Kale, Assistant Secretary of Defense for Industrial Base Policy. "Investments such as these execute President Biden's focus on strengthening supply chains for critical minerals for large capacity batteries and are one step in the Defense Department's strategy for minerals and materials related to batteries."
Jervois will use the funds to accelerate drilling to better define and expand resources at and around its Idaho Cobalt Operations mine and finalize a feasibility study for a refinery that would upgrade concentrates into cobalt products needed by American military and manufacturers.
The main deposit at Idaho Cobalt Operations hosts 43.6 million pounds of cobalt in 3.8 million metric tons of measured and indicated resources, a category that has been defined to a level of confidence for mining, averaging 0.52% cobalt. These high-confidence resources also host 69.8 million lb of copper and 68,500 oz of gold.
The deposit also hosts 18 million lb of cobalt, 32.3 million lb of copper, and 33,000 oz of gold in the lower confidence inferred resource category.
Upgrading the inferred resource and expanding the deposit, which is open for growth at depth and to the north, could add to the seven years of mining currently supported by the resources.
The adjacent Sunrise deposit could also add to the amount of cobalt available for mining, and Jervois is considering doing some drilling to upgrade this historical deposit to modern resource standards.
When it comes to breaking U.S. dependency on China and other countries for cobalt, establishing a domestic refinery may be more critical than a mine.
Some of the DOD funding is allotted to help Jervois finalize a feasibility study for a cobalt refinery in the U.S.
This effort is expected to be accelerated by a recent decision by Jervois to pivot its efforts away from expanding a cobalt refinery in Finland to building a similar facility in the U.S.
The cobalt refinery design and engineering work already completed for the Finland plant can be adapted for the planned U.S. refinery, which is expected to accelerate the completion of the feasibility study.
By leveraging DOD support, Jervois hopes to have the only primary cobalt mine and refinery in the U.S. ready to deliver a domestic supply of this metal critical to America's military and clean energy ambitions.
"A truly great step forward towards US capability in advanced weapons, batteries and green energy," Anthony Di Stasio, director of the Manufacturing Capability Expansion and Investment Prioritization office administering the funds, penned in a LinkedIn post related to the Idaho Cobalt Operations funding.
With more than 16 years of covering mining, Shane is renowned for his insights and and in-depth analysis of mining, mineral exploration and technology metals.
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