Australia cashes in on Cobalt
Australia’s cobalt mining sector is expected to register positive growth in 2021, with strong reserves and a significant project pipeline. Australia is already the third biggest cobalt miner, and with the world's second biggest reserves the country is well equipped to sustain growth. Here, we speak with Cobalt Blue about the company’s mission to create a completely environmentally friendly cobalt project, and what’s previously stopped Australia from forging ahead in the industry.
Cobalt is an integral material in our lives – so much so
that we probably don’t even realise half of the things we use where it is
present. From smartphones to electric vehicles (EVs) to wind power
infrastructure – it’s a darling of the technological revolution, and is only
expected to become more important as the world continues to digitise.
Yet supplies predominantly come from by-products of other
operations, the majority of which are found in the Democratic Republic of Congo
(DRC), renowned for its prevalence of child labour and other ethical problems.
With the nation contributing around 65% of the world’s cobalt (a figure the
World Bank predicts to rise to 73% by 2023), sustainable alternative producers
are a must if the industry is to grow responsibly.
This is where Australia can make its mark. With the
resources to make an industry revolution happen, it is now the priority to
ensure that operations provide the ethical and environmental sustainability
that stakeholders fear the DRC lacks – something that cobalt development
company Cobalt Blue’s Broken Hill project seeks to provide.
Cobalt in Australia
Cobalt is on the edge of a significant demand spike as batteries
become an increasingly common part of our lives, driven by the rise of
renewables.
“In the coming years, as we see more penetration of
renewables in society, we’ll need more batteries to efficiently dispatch that
energy,” says Cobalt Blue’s CEO, Joe Kaderavek. “The unfortunate thing with
renewables is they generate when you least need them – for instance solar
generates most of its load in the middle of the day, yet peak demand is in the
morning/evening. Society now has the ability to shift that generation using
batteries.”
Another interesting catalyst for cobalt’s rise is also, in
fact, the pandemic. While at its peak it had a detrimental impact on the price
of cobalt, a renewed push for EVs also came out of the outbreak as a result of
government purchase subsidies. While an unprecedented positive effect, it bodes
extremely well for the cobalt industry.
“The EV subsidies that the EU announced in April were so
generous that they made the whole issue of cost-competition between petrol and
electric vehicles obsolete,” says Kaderavek. “Covid-19 became an accidental
catalyst for boosting EVs and therefore battery materials.”
Australia’s 2020 Critical Minerals Projects list detailed
around 68 cobalt projects, showcasing a promising pipeline for the material.
One such project is Glencore’s Murrin Murrin nickel-cobalt mine in Western
Australia, which experienced 14% year-on-year growth in cobalt output in 2020.
The previous year, the site made up 66.7% of total Australian cobalt output,
making it the country’s largest single cobalt producer.
Increasing sustainability initiatives, as well as the
presence of a stricter regulations framework, make Australia a viable
competitor to DRC. According to Kaderavek, Australia has 16% of the world’s
cobalt resources but currently only produces around 5%. So why hasn’t Australia
previously monopolised on this industry? One reason is that traditional methods
are often too damaging and labour-intensive, requiring high temperatures and
pressure that causes equipment to break down rapidly.
“Operations often use 250°C to 300°C, and 50 atmosphere in
terms of pressure to leach out the metal,” he says. “These are also highly
acidic conditions which create acid by-products, which you then have to store
and dispose of.”
This is what makes Broken Hill a notable project, as it
provides a viable alternative to traditional methods, and may open the door to
Australia steaming ahead in the cobalt sector.
A new kind of cobalt project
The first thing to note about Broken Hill is that cobalt is
its sole product, a unique aspect that sets it apart from other operations
around the world.
“Globally, 98% of cobalt is a byproduct of copper or
nickel,” says Kaderavek. “In the case of copper it’s 60% of that market. And in
nickel’s case, it’s around 38%. Cobalt is essentially an accidental metal for
everyone except us.”
Such an operations model means costs are cut, as capital and
equipment expenditure are focused solely on the one material, as opposed to any
other metals extracted. The method of extraction itself is also novel.
“We developed a process that thermally decomposes the
pyrite, so there are no acidic by-products,” Kaderavek says. “It materially
drops costs and makes the process environmentally friendly. It’s a very elegant
solution to the challenge.”
The project is anticipated to produce around 4,000 tonnes of
battery-ready cobalt per year, with a project lifespan of 20+ years. As well as
the modified extraction process, electrified mine vehicles and eco-friendly
processing will ensure that operations are environmentally sound.
“We’re very proud of our operations because we’re large and
open cut, we’ll be rehabilitating the ground when we finish, and it will all go
back to the local community,” says Kaderavek.
Perhaps more importantly, the project will not only extract
the metal but also refine it – avoiding the usual process of sending the
mineral to China, where the methods of processing are often shrouded in
something of a mystery that has previously been cause for ethical concern.
“There’s a big push to source ethical cobalt,” Kaderavek
says. “Today, by the time cobalt is refined and goes into a battery, you’ve no
idea what went into it. In any given electric vehicle, for example, you might
have six to a dozen sources blended together and you’ve got no idea what’s
what. Unless you physically track the materials, you really don’t have any
idea.”
A pilot plant for the project is currently being built, with
the hope for the final stage to be completed in the next two years. Looking
forward, Kaderavek says that there is potential for the project to expand its
reach to other domestic projects, bringing in cobalt from operations throughout
Australia for refinement and setting the country up as a processing hub in its
own right.
With cobalt set to take centre stage as the battery
revolution takes hold, new players are entering the market to vie for a place
at the table – with Australia poised to play a significant role. While the
efficacy of many projects in the pipeline is still unknown, Broken Hill serves
as an example of the kind of environmentally-driven operations that will likely
populate cobalt’s future.
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