Name of the Project
Kwinana cobalt refinery (KCR).

Location
Kwinana Industrial Area, located 30 km from the Perth metropolitan area, in Western Australia.

Project Owner/s
Mining and minerals processing company Cobalt Blue Holdings (COB).

Project Description
KCR is a proposed cobalt/nickel facility representing Australia’s first cobalt sulphate refinery that will produce high-quality, battery-grade cobalt sulphate in response to the US Inflation Reduction Act, and EU markets. The refinery will process critical battery metals from third-party feedstock and mixed hydroxide precipitate from the Broken Hill cobalt project.

The project will be developed in stages. Stage 1 capacity is set at 3 000 t/y of cobalt (as cobalt sulphate) and about 500 t/y of nickel (as nickel metal). Stage 2 will double cobalt refining capacity.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
Stage 1 has an after-tax net present value (NPV) of A$90-million and an internal rate of return (IRR) of 23%, with a project payback of 5.2 years.

With the Stage 2 expansion, the project could return an incremental after-tax NPV of A$105-million and an IRR of 64%. Stage 1 and 2 combined results in an after-tax NPV of about A$175-million and an internal rate of return of 29%, generating earnings before interest, taxes, depreciation and amortisation of about A$46-million a year.

Capital Expenditure
Capital costs for Stage 1 are estimated at A$60-million. Stage 2 is estimated at A$23-million.

Planned Start/End Date
Stage 1 construction is expected to start in the first half of 2025, with completion expected within 12 months. Stage 2 is expected to take 12 months to build during 2028 and be operational from 2029. Stage 1 and 2 combined has an estimated capital expenditure of A$83-million.

Latest Developments
Cobalt Blue has signed a three-year deal with commodities giant Glencore to supply up to half of the feedstock required. Glencore will supply COB with up to 50% of KCR’s feedstock requirements for three years, starting from the startup of commercial operations at KCR.

The contract guarantees supply of a minimum of 3 750 t of cobalt hydroxide (750-million tonnes in Year 1, and 1.15-million tonnes in years 2 and 3), representing 50% of KCR’s initial feedstock requirements. 

The feedstock will be sourced from Glencore’s world-class Kamoto Copper Company (KCC) and Mutanda Mining SARL operations, in the Democratic Republic of Congo (DRC). The DRC is the world’s largest supplier of mined cobalt, accounting for 76% of global output, according to Benchmark Minerals Intelligence.

While COB prioritises the acquisition of cobalt hydroxide feedstock from Australian projects, current market dynamics require COB to extend its focus. Consequently, COB is in advanced discussions with other suppliers of cobalt feedstock in Australia and internationally to fulfil the refinery's remaining requirements. 

Key Contracts, Suppliers and Consultants
Not disclosed.

Contact Details for Project Information
Cobalt Blue Holdings, tel +61 2 8287 0660 or email info@cobaltblueholdings.com.