Jervois Mining to buy cobalt-nickel refinery in Brazil
Jervois Mining Ltd. [JRV-TSXV, ASX; JRVMF-OTC; IHS-FSE] said Tuesday September 29 that it is buying a nickel and cobalt refinery from a unit of Votorantim SA, one of Brazil’s largest diversified holding companies.
It is announcing the purchase after releasing the results of a bankable feasibility study for its high-grade cobalt project in Idaho.
By refining production from Idaho, Jervois aims to capitalize on the push for stricter emission controls, which is driving demand for electric vehicles and metals used to make lithium-ion batteries that power them.
“Battery demand for cobalt is expected to rise sharply, and ethical, non-Democratic Republic of Congo, low capital sources of supply outside the Idaho Cobalt Operations are essentially non-existent,” the company has said.
Jervois said in a press release that it will buy the Sao Miguel Paulista refinery in Sao Paulo from Companhia Brasileira de Alumino for $22.1 million.
The Brazilian refinery had a production capacity of 25,000 tonnes annually of nickel and 2,000 tonnes of cobalt before it was placed on care and maintenance.
Jervois shares were unchanged at 29 cents on the news, and currently trade in a 52-week range of 35 cents and 11 cents.
Jervois is focused on becoming a global supplier in the emerging battery metals market. In keeping with that focus, the company acquired eCobalt Solutions Inc. last year in a $57.6 million deal, a move that gave Jervois Mining access to eCobalt’s Idaho Cobalt Project, a high-grade cobalt deposit located in Idaho.
Idaho Cobalt Operations (ICO) is now Jervois’ flagship primary cobalt deposit located in Idaho near the town of Salmon. Over the course of 20 years, approximately US$100 million has been invested in developing the mine.
It is fully environmentally permitted for ore processing capacity of up to 1,200 tpd and has high cobalt and copper grades, with a gold by-product.
The company said ore reserves are 2.5 million tonnes at 0.55% cobalt, 0.80% copper and 0.64 g/t gold. As a result, it envisages average annual contained production of 1,915 tonnes of cobalt, 2,900 tonnes of copper and 6,700 ounces of gold with operations starting in Q2 2022.
On Tuesday, Jervois announced the successful completion of an updated bankable feasibility study for the ICO. It said the study confirms the potential of the project to establish a near term, low cost cobalt-copper-gold mine, with significant opportunity to increase the mineral resource and extend mine reserves once mining commences.
The study is based on processing 1,200 tons-per-day of mined cobalt-copper-gold ore. The total project capital cost to produce a bulk concentrate is estimated at US$78.4 million.
Jervois said it would refine cobalt concentrate from its Idaho facility and is targeting first concentrate deliveries from the United States by mid-2022.