First Cobalt has signed a memorandum of understanding (MoU) with Glencore to supply cobalt feedstock and financing to restart the First Cobalt Refinery in Ontario, Canada.
As per the MoU, First Cobalt and Glencore will collaborate on the final flowsheet design to expedite the restart of the only North American cobalt refinery. The MoU is subject to due diligence and definitive documentation.
Glencore plans to provide feedstock for the refinery, which is expected to have an annual production between 2,000 and 2,500 tonnes of cobalt in sulfate. It will also evaluate providing a loan to First Cobalt for the refinery’s restart.
The refinery is expected to begin operations in 18 to 24 months and the companies are in discussions with the provincial government officials to speed up the permit amendment process.
First Cobalt president and CEO Trent Mell said: “The partnership announced today will help First Cobalt achieve its stated objective of providing ethically-sourced battery grade cobalt for the North American electric vehicle market. As the world’s leading producer of cobalt, Glencore is an ideal partner for First Cobalt. Our shareholders will benefit from Glencore financial backing, technical support and opportunities for regional synergies with their Sudbury and Rouyn-Noranda operations.
“This announcement marks the culmination of one year’s work, bringing First Cobalt closer to generating cash flow and reducing reliance on the equity markets to fund future advancement of our North American primary cobalt assets in Idaho and Ontario.”
A final decision on bringing the First Cobalt Refinery back into production has not been taken yet and is contingent on the outcome of the ongoing discussions and studies.
First Cobalt has not completed a study of the economic viability of the refinery’s operation. The company said that any decision on restarting the refinery will not be based on anticipated development of any of the company’s current projects. Currently, none of its current projects is expected to act as a source of feedstock for the refinery.
First Cobalt, the only permitted primary cobalt refinery in North America, has recently completed testing a third party cobalt hydroxide as a potential source of feed, which confirms that the existing processes at the company can produce high purity, battery grade cobalt sulfate.
The company has also signed agreements with several automotive companies interested in securing cobalt for the North American electric vehicle market.
