eCobalt (TSX:ECS; OTCQX:ECSIF; FRA:ECO) is pleased to provide an update on the status of the Optimized Feasibility Study (“OFS”) and on progress of project financing for the Company’s 100% owned Idaho Cobalt Project (“ICP”), located near the town of Salmon, in the heart of the Idaho Cobalt Belt.
eCobalt (TSX:ECS; OTCQX:ECSIF; FRA:ECO) is pleased to provide an update on the status of the Optimized Feasibility Study (“OFS”) and on progress of project financing for the Company’s 100% owned Idaho Cobalt Project (“ICP”), located near the town of Salmon, in the heart of the Idaho Cobalt Belt. The ICP remains the sole, near-term environmentally permitted primary cobalt deposit in the United States.
Optimized Feasibility Study Update
Metallurgical optimization testing continues on ore material from the ICP’s Ram deposit with over 8 tons of ore used to advance this test work. As previously disclosed, laboratory-scale testing successfully demonstrated that ICP ore was amenable to arsenic (“As”) removal from concentrates by conventional roasting methods, in line with the Company’s direction to produce a clean (low arsenic content) cobalt concentrate product, an upstream precursor material for battery cathode production. Pilot level testing typically follows laboratory and bench scale test work on a feasibility level to reduce risk and add confidence in the final design of processing equipment.
The initial flowsheet that was tested used a fluidized bed roaster, the traditional method to remove arsenic from metal concentrates by roasting, to reduce the arsenic level in the concentrate to less than 0.5%, the level required by many smelters. Several pilot runs were executed at varying temperatures, oxygen content and durations. Results from these tests directed process engineers to replace the fluidized bed with a rotary kiln to maximize recovery of cobalt and sequestering of arsenic in a vitrified matrix. The mineralogy of ore from the Ram deposit has proven more amenable to a rotary kiln design as it is less vulnerable to adverse effects from changes in material properties of the concentrate during the roasting process. This current test work, utilizing a rotary kiln with a controlled atmosphere, achieved the target product, a low arsenic concentrate produced from ICP ore. Bench scale rotary kiln tests are currently in progress to define optimum process parameters for consistently achieving the <0.5% As target.
Bench scale tests utilizing a rotary kiln, conducted by Expert Processing Solutions (XPS), have demonstrated that a 0.2% residual arsenic content in concentrate is achievable. Additional testing has been recommended. This work will define conditions for pilot level roasting of the ICP ore in the third quarter with the goal to produce a clean, low arsenic, high value cobalt-copper-gold concentrate. Results of the pilot test work will determine the final detailed design and procurement of the critical process equipment.
Changes to the roasting portion of the flowsheet are required to accommodate the changing geometry and infrastructure required to support the new roasting method. While these processing changes are not anticipated to have a material effect on the capital or operating costs of a roasting facility, they do require time to be developed to a feasibility level of confidence. Delivery of the OFS is now expected in the third quarter of this year. The current project schedule is expected to be maintained through advancement of civil construction while the concentrate refining flowsheet is updated for the OFS. The Company’s target date for commercial production remains the H1 2020. The Company will continue to provide updates as available.
Project Finance and Off-take
Significant progress has been made on project finance and off-take arrangements. With positive long-term fundamentals for cobalt demand, the advanced nature of the ICP, and location in a geopolitically stable jurisdiction with production that is clean and traceable, the interest in off-take for the ICP’s future cobalt concentrate production has been strong. The demand has come from a variety of parties including traders, producers and end users in the battery and non-battery space. The ICP’s cobalt concentrate is unique compared to standard cobalt concentrates where cobalt comes as a by-product to other commodities. This has generated long-term partnership opportunities with counterparties for whom the Company’s product complements their existing refining capabilities and needs. As such, the Company has been undertaking a thorough evaluation to ensure that the right long-term partner(s) are identified.
The Company has also received preliminary project finance term sheets from multiple counterparties including strategic investors, private equity lenders, fixed income securities and commercial banks to finance the capital requirements of the ICP. These preliminary term sheets have been evaluated by the Company and will be updated with counterparties in conjunction with the advancement of the OFS. The Company’s finance decision will be based on cost of capital, flexibility, execution risks and timing to ensure that the project is fully financed with a structure that delivers the best value to the shareholders of the Company.
E.R. (Rick) Honsinger, P.Geo., Senior V.P. with eCobalt, is the Qualified Person who has reviewed and approved the contents of this news release.
About eCobalt Solutions Inc.
eCobalt is a well-established Toronto Stock Exchange listed company committed to providing clean cobalt products essential for the rapidly growing rechargeable battery and renewable energy sectors, made safely, responsibly, and transparently in the United States. The Company’s ICP, located in East Central Idaho, is the only environmentally permitted, primary cobalt project in the United States. It is 100% owned by the Company’s wholly owned subsidiary, Formation Capital Corporation, U.S.
For more information visit www.eCobalt.com.
Investor Relations Contact
Fiona Grant Leydier
V.P. Investor Relations
T: +1.604.682.6229 x 225
Cautionary Statement on Forward Looking Statements
This news release contains “forward-looking statements” within the meaning of applicable Canadian securities legislation. Statements in this news release pertaining metallurgical test work, financing, and project completion dates are forward-looking statements. These forward-looking statements are based on assumptions and address future events and conditions and are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Forward-looking statements are not guarantees of future results, performance or achievement. These risks, uncertainties and factors include general business, economic, competitive, political, regulatory and social uncertainties; actual results of exploration activities and economic evaluations; fluctuations in currency exchange rates; changes in project parameters; changes in costs, including labour, infrastructure, operating and production costs; future prices of cobalt; variations of mineral grade or recovery rates; operating or technical difficulties in connection with exploration, development or mining activities, including the failure of plant, equipment or processes to operate as anticipated; delays in completion of exploration, development or construction activities; changes in government legislation and regulation; the ability to maintain and renew existing licenses and permits or obtain required licenses and permits in a timely manner; the ability to obtain financing on acceptable terms in a timely manner; contests over title to properties; employee relations and shortages of skilled personnel and contractors; the speculative nature of, and the risks involved in, the exploration, development and mining business.
Such projections are and will inevitably always be dependent on assumptions about future mineral prices and development costs which will be subject to fluctuation due to global and local economic and industry conditions. Further information regarding risks and uncertainties which may cause results to differ from those contained in forward-looking statements is included in filings by the Company with securities regulatory authorities and is available at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Although the Company has disclosed that the ICP remains the sole, near term, environmentally permitted, primary cobalt deposit in the United States and offers a unique potential for North American consumers to secure an ethically sourced, environmentally sound supply of clean cobalt products, there is no guarantee that the Company will attain commercial production of such cobalt products for use in the rechargeable battery sector. Accordingly, readers should not place undue reliance on forward-looking statements. The Company does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws.
The statements contained in this news release in regard to eCobalt that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including eCobalt’s beliefs, expectations, hopes or intentions regarding the future. All forward-looking statements are made as of the date hereof and are based on information available to eCobalt as of such date. It is important to note that actual outcome and the actual results could differ from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties such as technological, legislative, corporate, commodity price and marketplace changes.