The Elements of Innovation Discovered
The Elements of Innovation Discovered
Metal Tech News- February 26, 2024
Jervois is endeavoring to establish a mine and refinery in the United States to produce the cobalt needed for EV batteries.
Jervois finished construction of its Idaho Cobalt Operations early last year but has delayed startup due to weak cobalt prices.
Industrial sites in Pennsylvania and Louisiana are on Jervois Global Ltd.'s short list of locations to build a domestic refining and recycling plant that will help break the United States' dependence on countries like the Democratic Republic of Congo and China for cobalt used in the lithium-ion batteries powering electric vehicles.
Jervois already owns Idaho Cobalt Operations, a cobalt mine and processing facility near Salmon, Idaho, that is fully developed but not currently in operation. The Australia-based company is currently in discussions with U.S. government officials on how best to vertically integrate the Idaho cobalt mine with a refining and recycling facility that would offer a domestic supply of cobalt to lithium-ion battery manufacturers and other industrial sectors.
Toward this overarching goal, the U.S. Department of Defense is providing Jervois with $15 million of Defense Production Act Title III funding to support the completion of a bankable feasibility study for establishing a refinery in the U.S. that is anticipated to produce enough cobalt sulfate for roughly 1.2 million EVs per year.
After spending several months looking for an ideal location, Jervois has selected one industrial site each in Pennsylvania and Louisiana to build the refinery.
The company is currently carrying out evaluations to determine which location offers the best engineering, environmental and economic parameters for developing the cobalt refinery, which will be detailed in a feasibility study slated for completion around midyear.
This would put the facility to process cobalt concentrates from Idaho on track for completion in time to meet the expected sharp rise in demand for battery-grade cobalt as the uptake of EVs accelerates into the second half of the decade.
"Based on Jervois' ongoing negotiations with OEM (automaker) customers, including those in the U.S., OEM projected cobalt orderbooks are expected to expand rapidly from 2025 and onwards," the cobalt mine and refinery development company penned in a statement.
Jervois is encouraged by current and potential future federal support for its plans to establish a cobalt supply chain that includes its Idaho operations and plans to build a refinery that would upgrade the concentrates produced at that mine into the battery-grade cobalt needed for EV batteries.
Last April, the company submitted an application to the U.S. Department of Energy's Loan Programs Office to finance the development of the refinery to be detailed in the feasibility study.
The loan is being considered under DOE's Advanced Technology Vehicle Manufacturing Loan Program, which was established to fund the construction of facilities that support the manufacturing of EVs and other advanced vehicles in the U.S.
In addition to direct financial support and potential loans, the U.S. government is looking into a mechanism that will help stabilize cobalt prices for domestic producers.
China, which accounts for roughly 76% of global cobalt refining, has a huge influence over cobalt pricing. This dominant position creates market uncertainty for companies trying to establish cobalt supply chains outside of the communist nation.
The main reason Jervois' fully constructed Idaho Cobalt Operations is sitting idle is due to the price of cobalt plummeting from above $37 per pound to just above $13/lb a 16-month span leading to completion of development of the mine and processing facility.
"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," Jervois Global Chairman Peter Johnston penned in a letter to shareholders last April.
Jervois finished construction of its Idaho Cobalt Operations early last year but has delayed startup due to weak cobalt prices.
In December, the U.S. Congressional Select Committee on the Chinese Communist Party proposed establishing a Resilient Resource Reserve to stabilize critical minerals prices in the U.S.
Aimed to insulate U.S. companies from China's control over the prices of critical minerals, including cobalt, the proposed reserve would help stabilize prices through the support of domestic producers when prices dropped below a certain threshold, which would be replenished by producers during periods of high prices.
If passed by Congress, this mechanism could help ensure the economic viability of Jervois' proposed cobalt supply chain, as well as other critical minerals mining and processing facilities in the U.S.
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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