Diversified mining company Eurasian Resources Group (ERG) is pursuing the development of a refinery to process cobalt hydroxide into cobalt sulphates, the primary form of supply for cobalt-bearing electric vehicle (EV) batteries.

The move to vertically integrate the company’s cobalt business is aimed at strengthening its position as a strategic supplier to the chemicals sector, particularly for batteries for EVs.

ERG has identified Saudi Arabia as a potential host jurisdiction for the refinery and is partnering with investment platform Thara to jointly investigate and pursue the investment in the country.

Thara is focused on unlocking the country's Vision 2030 opportunities, particularly in sectors where Saudi Arabia holds a distinct advantage. It aims to capitalise on the country’s mineral wealth, and leverage value chains in sectors such as chemicals, waste management and future materials.

ERG and Thara entered into a memorandum of understanding on January 12 outlining their cooperation.

“ERG expects sustained market penetration of EVs to drive a quadrupling of demand for nickel/cobalt/manganese and nickel/cobalt/aluminium cobalt-bearing batteries through 2030,” ERG CEO Benedikt Sobotka says, claiming that the company is leading industry efforts to ensure the sustainable, traceable cobalt sourcing into battery supply chains across the globe.

“Joining forces with Thara will accelerate our potential development of a cobalt sulphate refinery in [Saudi Arabia],” he says. 

Thara managing partner Hisham Attar says the collaboration will see the development of a critical value chain in Saudi Arabia.

“This endeavour embodies our commitment towards innovation and sustainable growth, unlocking new opportunities that align seamlessly with our vision and purpose,” he says.

The refinery will be supplied with cobalt hydroxide from ERG’s Metalkol facility in the Democratic Republic of Congo (DRC), a historic tailings reclamation and environmental restoration operation producing high-quality copper cathode and cobalt in hydroxide.

“ERG holds vast cobalt resources in the DRC and is one of the largest suppliers of cobalt hydroxide globally. Being underpinned by supply from our upstream operations, the planned cobalt refinery project is considerably de-risked,” Sobotka said.

Operations at Metalkol are in accordance with recognised responsible and sustainable practices as set out in the ERG Clean Cobalt and Copper Framework.