"We can create shareholder value very quickly because our path to production has a short timeline and low execution risk."

Trent Mell

PRESIDENT & CEO, FIRST COBALT CORP.

April 28, 2021

What have been the main milestones achieved by First Cobalt in the last 12 months?

First Cobalt has continued to work on its three assets, including our cobalt project in Ontario and flagship asset in Iron Creek, Idaho. However, the most salient accomplishments of First Cobalt in 2020 had to do with our refinery. This has been our core focus because it is the closest pathway to cash flow. Since First Cobalt’s interview with GBR in 2019, we have completed a feasibility study and advanced a whole series of work streams including permit amendments, commercial discussions and financing. The optimized definitive feasibility study (DFS) in September 2020 showed a US$60 million capex and an operating cost which is competitive with our peers, most of which are located in China. In December 2020, the Government of Canada and Province of Ontario announced an investment of CAD$10 million in our refinery in Northern Ontario. In the beginning of 2021, we announced long-term cobalt hydroxide feed arrangements with Glencore AG and IXM SA, a fully owned subsidiary of CMOC, which will provide a total of 4,500 mt/y of contained cobalt to the First Cobalt Refinery commencing in 2022.

What were the highlights from the First Cobalt Refinery Life Cycle Assessment released on October 29th?

We did a life cycle assessment against the Huayou Cobalt facility in China, choosing it as a reference because it is big and well-known, as well as one of the few facilities that has publicly available data. We learned that our environmental impact is going to be significantly smaller than that of our peers, and the findings were corroborated by research from the Cobalt Institute, who in 2012 conducted a study aggregating eight plants across different processing operations. Canada has a hydro-electric grid system that contributes to cleaner processes. However, the most telling finding was our performance in CO2 emissions. We measured across six impact categories and were far ahead in most of those, including water consumption. The study is a living, breathing document that we will use to enhance our flow sheet, update our processes and reduce emissions. We are excited about the results, especially given that we are part of a supply chain that sells directly to consumer products such as electric vehicles. The supply chain must be aligned in terms of environmental responsibility with its final product – a zero-emissions vehicle.

What is the current status of First Cobalt’s flagship Iron Creek project in Idaho?

The combination of indicated and inferred resource amounts to 5 million tonnes of high-grade cobalt on private land, which is important due to the shorter permitting timelines this entails in the US. The market for cobalt has been downtrodden in recent years, but since July, there has been a steady march upwards. There is more conviction in the commodity and therefore the right ingredients to expand the Iron Creek project, identify satellite deposits and get ready for a new cycle. President Biden has expressed his commitment to battery metals. Deposits like this one are rare and precious. In 2021, on the back of the geophysics program we are conducted in 2020, we expect to get back to drilling the property which remains our flagship asset.

Which catalysts have been impacting the cobalt market in 2020?

The Covid-19 crisis presented an opportunity for battery metals, and the need to stimulate employment has brought focus to a green recovery that includes electrification and infrastructure spending. This trend started in Europe, but Canada and the US are also mapping a strategy which should gain more clarity with the next stimulus package. The Big Three North American auto producers are reaching labour settlements in Canada that lean heavily towards electrification. For example, Ford committed to a C$1.8 billion investment in plants for battery packs and EV assembly – the contribution by the Ontario and Federal governments was C$590 million. The objective is to retool Southern Ontario assembly jobs North and marry them to mining jobs. That linkage will require a midstream supply chain including refiners like us and cathode manufacturers. Governments are being deliberate in supporting a strategy and vision for our industry.

Where would you like to see the company by the end of 2021?

By December 2021, we will have all permit amendments in place at the First Cobalt refinery for a larger throughput and will have our US$60 million financing in place, mostly in debt. Thirdly, we will have all our commercial contracts lined up. By Q4 2021, we should be around 40% of the way through construction. In terms of our asset in Idaho, we plan to conduct a drill program at Iron Creek to support a new resource estimate focusing on the inferred resource category. The goal is to add tonnes and test just how big the deposit could get.

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