First Cobalt to finalize new supply deal with Glencore
2020-11-11 13:04:59 [Print]
Canada's First Cobalt is planning to alter its prior arrangement with global miner Glencore and sign a long-term feed purchase contract instead of the original tolling contract
Securing feed material under a long-term cobalt hydroxide purchase contract would allow its refinery in Ontario to be "an active market participant and achieve market-based returns from its operations," First Cobalt said, adding that "this will also provide shareholders with greater leverage to the cobalt market."
Based on this new strategy, First Cobalt has resumed talks with lenders. Offtake discussions with OEMs and other cobalt sulfate consumers are underway and have been constructive, it said.
The company intends to finalize a supply agreement with Glencore on mutually agreeable terms while securing additional feedstock from other miners of ethically produced, high-quality cobalt hydroxide. It does not anticipate any difficulties securing sufficient feedstock for the refinery's nameplate capacity of 5,000 tonnes per annum of contained cobalt.
"Diversification of feedstock supply will help offset the risk of supply interruptions from any single operation," First Cobalt said.
Cobalt hydroxide feed material from Glencore's KCC mining operation was received in September, with leaching and neutralization testing performed ahead of pilot plant test work.
. First Cobalt currently owns North America's only permitted cobalt refinery.Securing feed material under a long-term cobalt hydroxide purchase contract would allow its refinery in Ontario to be "an active market participant and achieve market-based returns from its operations," First Cobalt said, adding that "this will also provide shareholders with greater leverage to the cobalt market."
Based on this new strategy, First Cobalt has resumed talks with lenders. Offtake discussions with OEMs and other cobalt sulfate consumers are underway and have been constructive, it said.
The company intends to finalize a supply agreement with Glencore on mutually agreeable terms while securing additional feedstock from other miners of ethically produced, high-quality cobalt hydroxide. It does not anticipate any difficulties securing sufficient feedstock for the refinery's nameplate capacity of 5,000 tonnes per annum of contained cobalt.
"Diversification of feedstock supply will help offset the risk of supply interruptions from any single operation," First Cobalt said.
Cobalt hydroxide feed material from Glencore's KCC mining operation was received in September, with leaching and neutralization testing performed ahead of pilot plant test work.