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September 05, 2023
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The suspension of trading in the securities of High-Tech Metals Limited (‘HTM’) will be lifted immediately following the release by HTM of an announcement regarding material acquisitions.
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This article includes content from High-Tech Metals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
HTM:AU
12 January
Appointment of Chief Executive Officer
07 August
Cobalt Market Update: Q2 2025 in Review
Cobalt prices remained elevated through the second quarter of 2025 after making a dramatic price surge early in the year.
The market tailwinds were largely attributed to the Democratic Republic of Congo’s (DRC) ongoing export ban on cobalt hydroxide.
First announced in February, the ban sparked a sharp price rally by mid-month, pushing standard-grade cobalt metal as high as US$15.75 per pound and lifting monthly averages by 45 percent, its most bullish move since 2022.
Prices for cobalt sulfate jumped even more steeply, climbing 74 percent month-over-month.
“If the DRC government wanted to flex its muscles and show miners and refiners who really controlled global cobalt reserves, it would appear they’ve succeeded for now,” wrote Fastmarkets’ Rob Searle in an April market update.
“Standard grade cobalt metal prices soared to highs not seen since November 2023 in the space of two weeks,” he added.
While prices initially stabilized in mid-April on renewed optimism from China, where futures markets rallied, sentiment remained fragile heading into May. With the DRC ban still in place and little progress reported in negotiations, cobalt prices held steady between US$15 and US$16 per pound.
According to Fastmarkets, import data from China showed a surge in cobalt hydroxide deliveries in March and April, though volumes were expected to taper off through the summer.
“For now, the cobalt market appears to have stabilized, with prices high enough to encourage sellers to offer material out. Refiners in China appear to have ample stocks of feed to continue to supply contract volumes,” Searle noted in a May overview.
He continued: “This month, we expect to see a reduction in import volumes of cobalt hydroxide into China. This is expected to tighten refinery feed out to August, should the export ban end towards the later stages of June, as initially planned.”
DRC extends export controls
After plunging to a nine year low in late January and then rebounding to multi-year highs by the end of Q1, cobalt prices began to ease in early June as supply uncertainty weighed on the market.
Despite the ongoing export ban in the DRC, trade data from China showed a significant influx of cobalt in April.
Imports of cobalt metal rose 60 percent month-on-month, driven largely by Indonesian supply, while exports surged 202 percent year-over-year.
"We are still seeing cobalt units arriving in China — or at least we were in May, which is the last month for which trade data were available,” said Olivier Masson, principal analyst at Fastmarkets, during a June presentation at the Lithium Supply and Battery Raw Materials conference.
According to Masson, China imported 75,000 metric tons of cobalt from the DRC in the first five months of 2025, along with another 22,000 metric tons in mixed hydroxide precipitate (MHP).
Of that MHP, 17,000 metric tons came from Indonesia. A region that is becoming increasingly important to the cobalt sector, especially as the DRC extended its export controls into September.
Although Indonesia is projected to increase its output, “the supply of cobalt from Indonesia is not going to be large enough to offset the loss of supply from the DRC,” said Masson.
Supply expected to slow in H2
Cobalt supply has surged over the past five years, with global mine production more than doubling from 140,000 metric tons in 2020 to 290,000 metric tons in 2024.
This rapid growth has far outpaced demand from the electric vehicle (EV) sector and other end users, resulting in a significant oversupply.
However, with the DRC -which accounts for roughly 70 percent of global cobalt production- extending its export limitations into the second half of the year mined supply is expected to register more muted gains in 2025.
“We expect mine supply growth to slow this year,” said Masson. “Prices are at multi-year lows, and yet, despite that, we still saw relatively strong growth numbers from major producers in the country.”
With exports stalled, inventories are building up in the DRC , a dynamic that may force operational adjustments.
“We might see miners who principally produce copper — and get cobalt as a by-product — start mining lower-grade cobalt ores in order to manage the inventories that are piling up,” Masson explained.
He added that cobalt sulfate demand slowed in 2024 due to a weaker-than-expected EV market in the West.
In response, Chinese refiners pivoted to producing cobalt metal instead, a shift that has significantly impacted global trade dynamics.
“Just like they did for nickel, Chinese refiners switched to cobalt metal production,” Masson said. “As a result, we’ve seen cobalt metal exports out of China jump by over 230 percent from January to May.”
Masson went on to explain: “This level of export growth is likely unsustainable. There’s limited feedstock coming from the DRC due to the export ban, and that will inevitably constrain Chinese production going forward.”
Strategically diversifying supply
As the global market looks ahead, geopolitical dynamics are taking on greater significance.
The US, which is seeking to secure non-Chinese sources of critical minerals, is actively engaged in negotiations with the DRC. At the same time, it’s backing infrastructure development, including support for the Lobito Corridor , a rail and port route that would allow DRC-sourced cobalt to be exported via the west coast of Africa, bypassing China entirely.
“Currently, about 83 percent of the DRC’s cobalt exports go to China,” Masson said. “But both the DRC and the US are motivated to diversify those flows.”
However, the US still lacks sufficient domestic PCAM capacity, a key step in the battery supply chain, which could limit its ability to process cobalt independently in the short term.
Looking at market dynamics more broadly, Masson said Fastmarkets expects cobalt supply to remain “adequate” in the near term. But with inventories outside the DRC being steadily drawn down, tighter conditions could emerge later this year.
“By August or September, we could start to see the market tightening,” he said. “Our price forecast before the export ban was extended … but now, there’s potential for prices to remain elevated longer than previously expected.”
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
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29 July
ASX Cobalt Stocks: 4 Biggest Companies in 2025
After spending much of the last two years trending downwards, the cobalt price is up in 2025.
About 75 percent of global cobalt output comes from the Democratic Republic of the Congo (DRC). While electric vehicle (EV) demand has remained positive, cobalt oversupply has weighed on markets and hurt efforts to build supply chains outside of the DRC.
However, the country banned exports of cobalt in February in an effort to increase the metal's falling price. By mid-March, cobalt had spiked to US$36,170 per tonne, up more than 65 percent from its record-low price of US$21,550 hit in late January. Heading into the second half of the year, cobalt prices have managed to stay above the US$33,000 level.
Increasing electric vehicle (EV) and lithium-ion battery demand is expected to be supportive for key battery raw materials in the coming years. This means that as demand for EVs increases, so too will demand for cobalt — and, as one of the top four cobalt-producing countries in the world, Australia finds itself in a position to capitalise on this demand.
Though it is only responsible for less than 2 percent of the world’s cobalt production, Australia holds about 15.5 percent of global reserves. Moreover, while the DRC’s labour and mining practices have often been labeled unethical and unsustainable, Australian miners are focused on safer, more environmentally friendly practices.
For investors looking to get exposure to the Australian cobalt market, these ASX cobalt stocks may be a good place to start.
Read on for a look at the biggest cobalt stocks on the ASX by market cap. All market cap and share price data was obtained on July 16, 2025, using TradingView's stock screener.
1. Ardea Resources (ASX:ARL)
Market cap: AU$88.37 million
Share price: AU$0.425
Ardea Resources' primary focus is developing its wholly owned Kalgoorlie nickel project, which the company says “hosts the largest nickel-cobalt resource in the developed world.”
Located in Western Australia, the project includes the Goongarrie Hub deposit.
A 2023 prefeasibility study shows that the Goongarrie Hub has an ore reserve of 194.1 million tonnes at 0.05 percent cobalt and 0.7 percent nickel, resulting in 99,000 tonnes of contained cobalt and 1.36 million tonnes of contained nickel.
The study indicates that this resource would support an open-pit mining operation with a 40 year mine life and annual output of 2,000 tonnes of cobalt and 30,000 tonnes of nickel.
Ardea is now working on a definitive feasibility study (DFS) with funding from its strategic partners, Sumitomo Metal Mining Co. (TSE:5713) and Mitsubishi (TSE:8058).
The DFS is slated for completion in the second half of 2025.
2. Cobalt Blue Holdings (ASX:COB)
Market cap: AU$24.91 million
Share price: AU$0.054
Cobalt Blue Holdings focuses solely on cobalt and is enthusiastic about the metal’s ethical and environmental potential within the renewable energy market. The company owns the New South Wales-based Broken Hill project, a cobalt asset that it says adheres to Australian labour and sustainability standards. It is also planning the Kwinana cobalt refinery.
In November 2023, Cobalt Blue released the results of its cobalt-nickel refinery study. During Stage 1, the proposed refinery will process third-party feedstock and will have a capacity of 3,000 tonnes of cobalt sulphate per year, along with 1,000 tonnes of nickel sulphate annually. Stage 2 will have the option to include potential feedstock from Broken Hill. The study projects stable margins throughout potential cobalt price fluctuations.
The Australian Government granted a three-year extension to the project's Major Project status in July 2025.
The company's potential partner for the refinery is Iwatani (TSE:8088), a battery minerals trader. According to Cobalt Blue, if everything goes through as planned, the refinery will be constructed on Iwatani's property in Western Australia's Kwinana industrial area.
Cobalt Blue provided an update on the refinery in late March 2025, reporting that 80 percent of the detailed plant engineering is completed and the refinery is advancing through the final stages to support a final investment decision. The two companies executed a pre-final investment decision consortium deed on April 11, and stated a decision is expected by December 31.
In May, Cobalt Blue inked a deal with Glencore (LSE:GLEN,OTC Pink:GLCNF,OTC:GLCNF) in which Glencore will supply cobalt hydroxide feedstock to the Kwinana cobalt refinery from its operations in the DRC. The three-year contract is for a minimum of 3,750 tonnes of cobalt hydroxide, which is half of the refinery's initial requirements, and comes into affect when Kwinana begins commercial production.
3. Coda Minerals (ASX:COD)
Market cap: AU$20.46 million
Share price: AU$0.086
Coda Minerals is advancing its Elizabeth Creek copper-cobalt-silver project located in the Olympic Copper Province of South Australia.
Coda completed an updated scoping study on the project in December 2024, which demonstrated robust economics with a 16 year mine life and the potential for annual production of about 26,700 tonnes of copper and 1,300 tonnes of cobalt at steady state production levels.
The mine plan includes three open-pit mines, one underground mine and a hydrometallurgical processing plant. During Phase 1 of planned production, Coda is looking to produce copper-cobalt concentrate over a one year period to generate cash-flow.
Once in Phase 2, the hydrometallurgical plant is intended to produce higher value saleable end-products such as copper cathode and battery-grade cobalt sulphate.
In July 2025, Coda announced the submission of the draft scoping report on the Elizabeth Creek project to the South Australian Department of Energy and Mining, which the company said represents a significant step in the path to obtaining a Mining Lease.
4. Kuniko (ASX:KNI)
Market cap: AU$8 million
Share price: AU$0.094
Norway-focused Kuniko is targeting three metals key for the EV industry: cobalt, nickel and copper.
The majority of its assets are in Norway, including its Skuterud cobalt project, Undal-Nyberget copper project and Ringerike battery metals project. Ringerike hosts the past-producing Ertelien nickel-copper-cobalt target.
In 2023, Kuniko received an investment of AU$7.8 million by Stellantis (NYSE:STLA), which acquired a 19.99 percent interest in Kuniko and secured a 35 percent offtake for future production of nickel and cobalt sulphate from Kuniko's Norwegian projects for nine years.
Kuniko undertook a second phase expansion drill program over the summer of 2024 at Ertelien, and released an updated resource estimate for Ertelien in December that included the results from that program.
The new resource totals 40 million tonnes of ore at an average grade of 0.25 percent nickel equivalent, made up of 22 million tonnes of indicated resources at 0.26 percent nickel equivalent and 18 million tonnes of inferred resources at 0.25 percent.
Overall, the deposit contains 5,600 tonnes of cobalt, 71,000 tonnes of nickel and 49,000 tonnes of copper.
Don’t forget to follow us @INN_Australia for real-time updates!
Securities Disclosure: I, Melissa Pistilli, currently hold no direct investment interest in any company mentioned in this article.
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07 July
Cobalt Blue's Broken Hill Project Gets Major Project Status Extension
Cobalt Blue Holdings' (ASX:COB) Broken Hill cobalt project has received a further three years of major project status.
The extension of major project status for Broken Hill follows the project's initial designation originally granted in March 2022, and supports the continued development of this key asset in remote western New South Wales.
The project spans approximately 37 square kilometres.
“While cobalt is typically recovered as a by-product of copper or nickel, the Broken Hill Cobalt Project (BHCP) will be a primary cobalt operation with elemental sulphur as a byproduct,” Cobalt Blue notes on its website.
The project hosts a global mineral resource estimate comprising 126.5 million tonnes at 867 parts per million (ppm) cobalt equivalent (690 ppm cobalt, 7.5 percent sulphur and 134 ppm nickel) for 87,000 tonnes of contained cobalt, 9,510 kilotonnes of sulphur and 17,000 nickel (at a 275 ppm copper equivalent cut off).
According to CEO Andrew Tong, the major project status acknowledges the strategic significance of the project in the delivery Australia’s Future Made in Australia agenda, Critical Minerals Strategy and National Battery Strategy.
“Obtaining a three year extension to Major Project Status for the Broken Hill cobalt project is an important enabler for our project development plans,” he said in a July 3 press release.
“This also creates an opportunity for locally-sourced feedstock to support the growth of new Australian downstream industries – an ambition we are actively pursuing through our Kwinana Cobalt Refinery and Broken Hill Technology Centre.”
The Kwinana cobalt refinery is planned by Cobalt Blue to be Australia’s first cobalt sulphate refinery that will produce high-quality, battery-grade cobalt sulphate for the global lithium-Ion battery Industry.
Cobalt Blue said that the project’s recognition also strengthens its project partnership with Iwatani.
“(We welcome) this support … and it reinforces our decision to invest in Australia. The recognition of the Broken Hill cobalt project further strengthens the case for progressing the Kwinana Cobalt Refinery toward a final investment decision,” Iwatani commented.
Don’t forget to follow us @INN_Australia for real-time news updates!
Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.
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25 June
Cobalt Prices Surge as DRC Extends Export Ban to September
Cobalt prices are surging after the Democratic Republic of Congo (DRC), the world’s largest producer, extended its export ban by three months in a bid to address global oversupply and stabilize plunging prices.
According to the Financial Times, cobalt prices on China’s Wuxi Stainless Steel Exchange rose nearly 10 percent after the DRC government announced the news over the weekend.
The ban — originally set to expire on Monday (June 23) — will now remain in effect until at least September.
The DRC's Strategic Mineral Substances Market Regulation and Control Authority (ARECOMS) said the extension was necessary “due to the continued high level of stock on the market.”
The ban, first imposed in February of this year, was initially slated to last four months.
It came after a prolonged slump in cobalt prices, which have plummeted approximately 60 percent over the past three years, reaching a nine year low of US$10 per pound earlier this year.
The DRC produced 72 percent of the global cobalt mine supply in 2024, as per market intelligence firm Project Blue.
The export halt has already begun to ripple through international markets. In China, where most of the world’s cobalt is refined, prices for the metal and related company stocks spiked.
"We are likely to see an initial price spike, but real pressure will be later in the year as intermediate stocks begin to dry up," Thomas Matthews, a battery materials analyst at CRU Group, told Bloomberg. "In short, strap yourselves in."
The government of the DRC is attempting to tackle a persistent supply glut that has undermined the cobalt market since 2022. By curbing exports, Kinshasa is aiming to drive up prices, thereby increasing revenues from royalties and taxes on mining companies, while also incentivizing further investment in its domestic mining infrastructure.
ARECOMS said that a follow-up decision will be made before the new deadline in September, signaling that the ban could be modified, extended or lifted depending on market developments.
Reuters reported last week that Congolese officials are also exploring a quota-based system for cobalt exports, which would allow selected volumes to leave the country while still exerting downward pressure on global supply.
The proposal has garnered support from major industry players.
Glencore (LSE:GLEN,OTC Pink:GLCNF), the world’s second largest cobalt producer and a key stakeholder in Congolese mining operations, is backing the potential quota system. The Swiss trader declared force majeure on some of its cobalt supply contracts earlier this year due to the export restrictions, citing exceptional circumstances. Nevertheless, Glencore has managed to fulfill its obligations so far, thanks to pre-existing cobalt stockpiles located outside the DRC.
By contrast, CMOC Group (OTC Pink:CMCLF,HKEX:3993,SHA:603993), the China-based firm that overtook Glencore as the world’s top cobalt producer in 2024, has been lobbying for the ban’s complete removal.
CMOC, which processes a significant share of Congolese cobalt in China, argues that prolonged supply constraints could jeopardize downstream industries and global battery production.
A race against the clock
Despite initial cushioning from global stockpiles, experts warn that refined cobalt supply may soon run thin.
Transporting cobalt from the landlocked DRC to China’s processing hubs typically takes about 90 days. This means that if shipments do not recommence soon, shortages could begin to materialize in late Q3 or early Q4.
"Stockpiles of cobalt outside the DR Congo will reach very low levels by the September 21 deadline if nothing else changes," Jack Bedder, founder of Project Blue, told the Financial Times.
Cobalt plays a vital role in lithium-ion batteries used in electric vehicles, consumer electronics and renewable energy storage. While many battery makers have begun shifting toward lower-cobalt or cobalt-free chemistries, demand for the metal remains strong — especially for high-performance applications.
Complicating the supply/demand dynamics is the fact that cobalt is often a by-product of copper mining.
With copper prices rebounding sharply — trading around US$9,600 per metric ton this week on the London Metal Exchange — producers have little incentive to curb overall output.
The move to extend the cobalt ban also coincides with the DRC’s recent efforts to assert greater control over its vast mineral wealth. The Central African nation is currently in discussions with the US over a potential minerals partnership aimed at strengthening supply chain security for clean energy technologies.
The export suspension is just the latest in a series of efforts by resource-rich countries to assert more control over key commodities. Similar moves have been seen in Indonesia, which banned nickel ore exports in 2020 to spur domestic processing, and in Chile, where the government is pushing for greater state participation in the lithium sector.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
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09 April
Cobalt Market Update: Q1 2025 in Review
Cobalt metal prices fell to a nine year low in February after another year of oversupply, but rebounded sharply after the Democratic Republic of Congo (DRC) instituted a four month export pause for the critical metal.
After starting the year at US$24,495 per metric ton, cobalt ended the three month period at US$34,040.40, a strong 39 percent increase from January’s value. The price spread between cobalt’s first quarter low of US$21,467.70 on January 29 and its Q1 high of US$36,262 on March 17 is even more impressive at 69 percent.
The drop to US$21,467.70 marked the battery metal's lowest level since February 2016.
Cobalt's Q1 price activity comes after a persistent glut in the market prevented prices from gaining in 2024, and this oversupply continued to weigh the market down for the first 45 days of 2025.
A February 22 announcement that DRC would curtail cobalt shipments until the end of June provided much-needed tailwinds for prices, propelling them to highs last seen in 2023. Now sitting at the US$33,660.80 level, questions abound about what will happen to cobalt prices and the supply landscape during the rest of the year.
DRC export suspension boosts oversupplied market
Cobalt supply has ballooned over the last five years, with annual mine supply of the critical metal growing from 140,000 metric tons in 2020 to 290,000 metric tons in 2024. This 107 percent increase has far outpaced rising demand from the electric vehicle (EV) sector and other end-use segments, leading to a massive oversupply.
In mid-February, Rob Searle, battery raw materials analyst at Fastmarkets, wrote that while sector participants were waiting to see whether demand would pick up after the Lunar New Year, his firm wasn't overly optimistic on prices.
"At this stage we are not expecting a significant price correction given the oversupplied nature of the market from intermediates to cobalt metal," he explained, adding that cobalt could be due for "another bearish year."
Searle also noted that producer CMOC’s (OTC Pink:CMCLF,SHA:603993) 2025 guidance is pegged at 100,000 to 120,000 metric tons, on par with the 114,000 metric tons it produced in 2024.
Looking at the US, he said while potential tariffs on Canadian cobalt metal could create short-term tightness for "certain Western brands," Fastmarkets wasn't looking for a strong 2025 recovery in standard-grade cobalt metal pricing.
In response to the free-falling cobalt metal price, the DRC — the world’s leading cobalt-producing country by far — enacted a four month cobalt export suspension on February 24. The move quickly added tailwinds to cobalt metal prices, which as mentioned rose to a two year high of US$36,262 on March 17.
“The cobalt market has been quiet and stagnant for some time as production has far outstripped demand in the last 18 months. This was the first sign of life and took nearly all parties by surprise … a cut of supply this large will likely lead to a significant price correction in the coming months,” Searle noted in a March 14 release.
“Post-June, when the ban is supposed to lift, the potential for export quotas going forward could support cobalt hydroxide and metal prices for the remainder of 2025 and into 2026.”
While companies are unable to ship cobalt hydroxide from the DRC, the suspension does not prevent the production and stockpiling of the critical material. Officials plan to review the embargo after three months.
Breaking down cobalt demand
The battery sector remains the largest cobalt end-use segment, representing approximately 70 percent of demand. This includes batteries in EVs, consumer goods and energy storage systems.
Super alloys, tooling and chemicals and catalysts account for the majority of the remaining 30 percent, with a small fraction also being used in magnets, medical implants and additive manufacturing (3D printing).
As Adam Webb, head of battery raw materials at Benchmark Mineral Intelligence, explained at the Toronto-based Benchmark Summit in March, positive forecasts and significant growth in the EV market in 2020 and 2021 led to a widespread demand uptick for battery raw materials, including cobalt.
“That led to markets going into deficit, prices rising, and that incentivized new production to come online,” he said.
“But bringing on a new mine is not like turning on a tap — it takes time. So that new supply that was incentivized eventually came online a couple of years later, at the same time there’s been a slowdown in the growth of that demand, and that's led to all of these markets becoming oversupplied and weighing on prices," Webb added.
Will EV growth catalyze cobalt prices?
Although global EV sales have been lower than projected, the sector has registered widespread growth, setting a sales record in 2024 of 17.1 million EVs sold, representing a 25 percent year-on-year increase.
Regionally, China dominated with 40 percent growth, capped by a historic December that saw 1.3 million EVs sold, the highest monthly volume ever recorded, according to RhoMotion. The US posted a modest 9 percent uptick, fueled by federal tax credits that are now threatened by potential Trump administration rollbacks; meanwhile, Europe lagged with a 3 percent decline as automakers and consumers braced for tougher 2025 emissions standards.
“What is clear is that Government carrots and sticks are working,” Rho Motion data manager Charles Lester said in a January report. He explained that subsidies, incentives and mandates in the UK and North America supported growth.
“Meanwhile the removal of subsidies in Germany had a devastating impact on the whole European market, if the US follows suit, we may see the same there,” Lester added.
While full Q1 data for EV sales is yet to be available, January brought sales of 1.3 million units, an 18 percent year-on-year increase. The steady increase has prompted Rho Motion to forecast full-year sales exceeding 20 million units.
Substitution concerns mount as supply chain tightens
While EV sales continue to rise, cobalt’s future demand outlook is slightly obscured. The opacity is due to its growing substitution, with some battery chemistries using smaller amounts or no cobalt at all.
Although lithium nickel manganese cobalt oxide (NMC) batteries remain the preferred chemistry for EV batteries, lithium iron phosphate (LFP) chemistries have been increasing their market share. Accounting for 6 percent of the battery sector in 2020, LFPs now comprise as much as 34 percent of the market.
Even with low prices making cobalt affordable, the market is fraught with issues that make substitution appealing.
Human rights abuses, including child labor and unsafe work conditions in the DRC, have long plagued the country’s cobalt sector. These ethical concerns have prompted companies to seek more sustainable and humane alternatives.
Concentration of production has also created instability in the cobalt supply chain. The DRC's dominance in cobalt production, accounting for over 60 percent of global supply, exposes manufacturers to geopolitical and supply risks.
To combat these issues, researchers and companies are developing cobalt-free battery technologies, such as lithium-ion batteries using nickel-rich cathodes, which perform comparably to traditional cobalt-based batteries.
“In 2024, the volume of cobalt deployed per vehicle declined by 25 percent year on year,” as per Fastmarkets.
While demand for cobalt will continue due to the expansion of the EV market, these ethical, economic and supply chain concerns are driving the industry toward alternative battery chemistries with reduced or eliminated cobalt content.
In light of these factors, Benchmark’s Webb expects the cobalt sector's compound annual growth rate to be slightly lower than that of other battery raw materials, coming in at 7 percent over the next decade.
“That's simply because cobalt is not used in every single lithium ion battery, whereas lithium — the clue is in the name — it is,” said Webb.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
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26 March
Letter from the CEO: Unlocking the True Value of Electric Royalties Ltd
Dear Valued Shareholders, Partners and Friends. Electric Royalties Ltd. (TSXV:ELEC)(OTCQB:ELECF) ("Electric Royalties" or the "Company") was founded on a simple yet powerful premise: to build a portfolio of royalties on critical metals that are essential to the clean energy transition. In the past five years, we have outperformed our original growth expectations by expanding our portfolio from 11 royalties to 43, and acquired 17 lithium properties that are optioned out with potential to become future cash-flowing royalties.
And yet, despite this ~290% increase in our portfolio size, our stock trades well below its value when we went public. Let me be clear-the value of the Electric Royalties portfolio is not reflected in our market capitalization. The market does not yet recognize this valuation gap.
A Portfolio Packed with Value
Our asset base is diversified across metals critical to the clean energy revolution. To underscore the potential intrinsic value of our portfolio, I would like to recap some of our cornerstone royalties and the progress they have enjoyed since we acquired them.
We acquired a cash flowing 0.75% Gross Revenue Royalty on the producing Punitaqui copper-gold mine in Chile in December 2024. The operator is currently focused on ramping up production to achieve 19 to 23 million pounds of copper annually, and near-mine exploration to extend mine life beyond the current seven years1.
The Battery Hill Manganese Project has seen excellent progress since we acquired our royalty in June 2020. Battery Hill is one of the largest carbonate manganese deposits in North America and has the potential to be a substantial contributor to the supply chain of high-purity manganese for the EV industry2. The project has moved smartly through establishing mineral resources, completing a Preliminary Economic Assessment (PEA) and now has a Pre-Feasibility Study (PFS) underway.
The PEA showcases a base case 47-year mine life with average annual revenues of approximately US$177 million3. Once Battery Hill is in production, Electric Royalties is entitled to 2% of annual revenues from the project arising from our 2% Gross Metal Royalty. We are not the only ones recognizing the potential at Battery Hill, as mining luminary Eric Sprott recently threw his support behind the project, providing funding to the operator, Manganese X, to produce the PFS (which is expected to be completed this year).
The PEA is preliminary in nature; it includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the projections in the PEA will be realized.
The Mont Sorcier Iron-Vanadium deposit is a very exciting development project in Canada. This project has attractive economics, in part due to the vanadium content on which Electric Royalties holds a 1% Gross Metal Royalty. Not only has considerable progress been made on the technical front with a funded Feasibility Study underway, but corporately a partnership has been established with Glencore, and there are clear indications of project financing for US$420 million from a UK export-import bank.
The PEA has a mine life of 21 years, a planned annual production rate of five million tonnes, and a US$15 per tonne vanadium credit4.
The PEA is preliminary in nature and includes Mineral Resources that are not Mineral Reserves and do not have demonstrated economic viability. There is no certainty that the projections in the PEA will be realized.
The Bissett Creek Graphite Project, located in Northern Ontario, Canada, is operated by Northern Graphite, one of the very few graphite producers outside of China. Our 1.5% Gross Revenue Royalty was the first royalty financing on an advanced graphite project. Northern Graphite has stated its goal to make Bissett Creek its flagship asset. The PEA calls for production of 33,183 tonnes per year5, and management has recently stated that they aim to ultimately produce up to 100,000 tonnes per year from Bissett Creek6 as part of their battery manufacturing JV intended to be set up in Ontario.
We acquired the 1.5% Net Smelter Royalty on Seymour Lake, located in Northern Ontario, Canada, for consideration of approximately C$1 million, which was paid in Electric Royalties shares in 2021. Since that time, the current operator has raised C$70 million for development activities, an updated mineral resource estimate and the completion of a PEA and is now preparing a Feasibility Study. The project has also benefited from strong federal government support, having received a C$100 million Letter of Intent for project financing with the intent of progressing the project towards becoming the first lithium mine to enter production in Ontario. Due to technical disclosure rules, I'm not able to comment on the project's planned production profile as the operator, Green Technology Metals, is listed on the ASX; however, I encourage people to visit their corporate website for more information.
Zonia is a copper oxide development project located in Arizona - a jurisdiction ranked by the Fraser Institute as seventh best of 86 mining jurisdictions assessed for Investment Attractiveness in 2023. Since we acquired our 0.5% Gross Revenue Royalty in March 2022, a resource update was completed resulting in the resource doubling from around 500 million pounds to close to 1 billion pounds of contained copper in the ground7. As a result, we expect that the upcoming Feasibility Study will have a larger production profile than the PEA. Due to technical disclosure rules, I am no longer able to publicly reference the PEA as it has been superseded by the technical report on the updated mineral resource estimate; however, a feasibility study is currently underway and due out in the near future. In the past few weeks, World Copper received a Letter of Intent for the acquisition of Zonia from World Copper with the intent of fast tracking the project to production.
The Middle Tennessee Zinc Mine (MTM) has been a swing producer of zinc for over 50 years and produced around 2 billion pounds of the metal during that time. Germanium and gallium are both important by-products at MTM and both have become of increasing strategic importance since China's ban on their export in 2024. Due to this renewed importance, and the recent uptick in zinc prices, we believe there is urgent incentive to get the currently idled mine back into production in the USA.
We acquired our 2.5% Net Smelter Royalty on the Graphmada Graphite Mine in Madagascar for shares in 2021. Although this isn't a significant long-term value driver for Electric Royalties due to a cumulative cap on revenues of A$5 million and an expiry date of January 1, 2029, it could have a large impact on immediate cash flows once the operator secures a partner to finance a return to production. Graphmada was previously in production for 18 months and consistently obtained product qualification with offtakers but was shut down due to Covid restrictions in the country. Management of the project is seeking project financing to re-start the mine.
We acquired our 1.5% Gross Revenue Royalty on the Penouta Tin Mine in Spain in 2023. After several quarters of cash flow to Electric Royalties, we were disappointed to learn of the Spanish court's revocation of Strategic Minerals' permit at the end of 2023. This came at a time when Penouta, Europe's only producing tin mine, was steadily ramping up production in an environment of steadily increasing tin prices. The idling of mine operations triggered a voluntary restructuring in November 2024. Management is working towards a positive resolution to the financial restructuring and permitting in the near future. With the recent stoppage of production at Alphamin's operations in the DRC due to regional conflict, tin prices have significantly increased8 and it would be welcome news indeed to have a successful permitting resolution at Penouta.
Sayona Mining raised over A$400 million to develop the North American Lithium Hub (NAL) in Northern Quebec, Canada. NAL is an integrated operation and went into production in March 2023. This is tremendous news for our 0.5% Gross Metal Royalty on part of the Authier lithium deposit, which we acquired in June 2020, in that Authier is a key part of that operation. In the NAL Feasibility Study, it is stated that Authier is planned to supply 1/3 of the feed to the NAL plant. The Authier royalty is the only royalty in our portfolio that doesn't cover the entire property, so exact royalty revenues annually are more difficult to estimate.
Some honorable mentions from the remaining 33 royalties and other assets in the portfolio:
- Kenbridge- 0.5% Gross Revenue Royalty - acquired in 2023. NI 43-101 Preliminary Economic Analysis completed.
- Ontario Lithium Royalty Portfolio - acquired in 2024. 19 royalties in and around all the most advanced lithium projects in Ontario including Georgia Lake, Pak/Spark, and Seymour Lake/Root Lake.
- Ontario Lithium Property Option Portfolio - acquired in 2024. The portfolio received payments totalling approximately C$750,000 in 2024 and we expect similar payment amounts from the currently optioned 17 properties surrounding the most prospective lithium projects in Ontario.
- Sleitat - 1% Net Smelter Royalty - acquired in 2022. One of two potentially economic tin deposits in the entire United States, according to the USGS9.
- Cancet - 1% Net Smelter Royalty - acquired in 2021. Over A$50 million raised for exploration of Cancet and regional projects by operator Winsome Resources since our royalty acquisition.
- Millennium - 0.5% Gross Revenue Royalty - acquired in 2021. Currently being advanced by JV partners Global Energy Metals and Metals Bank.
- Rana - 1% Net Smelter Royalty - acquired in 2021. Well-funded through operator's JV partner Kingrose Mining, a participant of BHP's Xplor program.
- Graphite Bull - 0.75% Gross Revenue Royalty - acquired in 2021. Pre-feasibility currently underway.
Many of these projects are advancing towards production, with 4 royalties with potential to re-enter or enter production over the next twelve months, and feasibility studies expected on another 5 royalties over the same time period. Over C$700 million has been raised by operators to advance the projects in our royalty portfolio, and all of that positive development costs Electric Royalties nothing, nor will the remaining paths to cash flow on each of our 43 royalties.
Assets Across Secure Jurisdictions
We have carefully built a portfolio of royalties on assets in North America, Europe, and Australia-regions known for their stability, infrastructure, and commitment to responsible resource development. As global markets increasingly prioritize security of supply, particularly for critical minerals, we believe our focus on these stable, mining-friendly jurisdictions positions us ahead of the curve. Our royalties are on rapidly developing assets, with the potential to ensure long-term value for our shareholders.
The Benefits of a Royalty Model vs. Traditional Mining Companies
Unlike traditional mining companies, Electric Royalties carries minimal operational risk. We don't bear the cost of mine construction, permitting, or operational challenges. Our business model allows us to benefit from rising commodity prices, increased production, and mine expansions-all without the need for additional capital outlay from us. This low-risk, high-upside structure makes royalty companies one of the most resilient business models in the resource sector.
A Discussion of Our Valuation
The disconnect between our share price and our view of potential true value is stark. While the market may not yet appreciate what we have built, insiders certainly do. I, along with my extended family, own approximately 18% of the company. Stefan Gleason, a noteworthy investor and business owner in the resource sector, owns approximately 28%, while Globex Mining owns approximately 11%. The majority of the remaining shares are largely held by high-net-worth individuals who recognize the long-term potential of our portfolio. This concentrated, committed shareholder base speaks volumes about the belief in Electric Royalties' future success. However, management believes that the following factors are affecting current share valuation:
- Acquisition Share Payments - Electric Royalties has only raised around C$13 million in equity since its inception over five years ago. This means that in order to grow the portfolio to the current total of 43 royalties, while also funding five years of G&A and going public costs, we've at times used our shares in order to acquire certain royalty assets. We issued over C$12.5 million in shares for acquisitions, and as far as we know, almost all of those shares have since been liquidated in the open market when royalty vendors needed funds to advance their projects - and this has impacted our share price.
- Lack of Marketing Expenditures during 2023 and 2024 - We reduced marketing spend in 2023 and 2024 so that we were able to prioritize the acquisition of producing and near-producing royalties. Going forward, we plan to expend more time and effort telling our story to broader markets.
- Lithium Prices - Electric Royalties' portfolio has a high percentage of lithium royalties, and since rising by almost 19x in 2022, lithium prices have declined significantly, potentially impacting our share price.
- Convertible DebtFacility Prevented Dilution - Our C$10 million convertible debt facility is a one-of-a-kind, company-friendly acquisition facility that we used to grow our portfolio through several acquisitions over the past two years without dilution other than interest payments:
- The lender is our largest shareholder, Stefan Gleason, who owns approximately 28% of the Company.
- It is convertible into shares in the C$0.50 to C$0.70 range, significantly above our current share price.
- We don't owe a cash payment of any kind until maturity in January 2028 and all of the interest accrued to date was recently converted into shares of Electric Royalties.
- There is no early repayment fee so at any point over the next three years, whether through refinancing a larger facility for more acquisitions, raising equity at a higher valuation over the next three years to repay it or repaying it from cash flow, there is no extra cost to repaying the loan early.
- Penouta and MTM being put on care and maintenance in 2023 - Both our producing royalties Penouta and Middle Tennessee Zinc unexpectedly halted operations at the end of 2023 for completely different reasons, which has impacted our revenues and the share price. We expect MTM to come back into production in the near term and will update the market as soon as we receive news on Penouta.
- US Brokerage Rules - Arbitrary new rules imposed by brokerage firms have recently made securing private placement investments from US investors much more difficult. More specifically, brokerages in the US will no longer allow the deposit of shares held in certificate form when such shares are trading below US$0.50 - making new investments in our stock via private placement almost completely illiquid for US investors.
These liquidated shares have mostly been acquired by my extended family or Mr. Gleason via open market purchases. Hence Mr. Gleason, my family, and Globex Mining now own roughly 57% of the stock outstanding. We are pleased that the stock consolidation has resulted in supportive, long-term shareholders. Additionally, about 80% of our recent financing was filled by management's president's list - another vote of confidence by people closely following our story.
While we have what we believe to be a well positioned lithium royalty portfolio, we are quite diversified across the other eight clean energy metals and are planning to pursue more copper, tin, and zinc acquisitions in 2025 with a particular focus on copper assets. And while lithium prices are down, they are still double what they were when we made our first investments into our most advanced lithium assets, and copper and tin prices are currently performing well.
Roadmap for 2025: Growth, M&A, and a Transformative Transaction
We have a clear roadmap for the year ahead. Our 2025 plans include pursuing:
- Strategic funding partnerships to support ongoing expansion and ensure financial flexibility;
- Corporate M&A initiatives to further strengthen and diversify our royalty portfolio; and
- A transformative transaction that could significantly enhance our scale, market position, and visibility.
We are not sitting idle waiting for recognition. We continue to add value through acquisitions and strategic partnerships, ensuring we hold a dominant position in the clean energy metals space. We remain steadfast in our mission, and we believe that over time, fundamentals will win out.
Immediate Revenue Growth Potential
With the most recent acquisition of a new gross revenue royalty on the producing Punitaqui copper-gold mine in Chile, along with option payment revenues from our optioned lithium properties in Ontario, and advanced royalty payments on Bissett Creek, Electric Royalties has four royalties with the potential to either recommence production or enter production for the first time in 2025 including:
- Middle Tennessee Zinc (care and maintenance since 2023; zinc prices up significantly since then);
- Graphmada (under care and maintenance since 2020, with a search underway for a JV partner to recommence production);
- Penouta (under care and maintenance since 2023; permitting and financial restructuring ongoing as tin prices are up 50% since production halt); and
- Authier (NAL hub entered production in 2024; Authier makes up 30% of the ore in the feasibility plan).
Development Growth Catalysts
A large portion of the value in our portfolio is derived from our near-term development royalty assets. There are exciting developments underway on assets the company acquired two to four years ago that have made significant strides towards being construction ready and ultimately closer to production. This year we are expecting major milestones for:
- Seymour Lake (feasibility study underway)
- Mont Sorcier (feasibility study underway)
- Zonia (feasibility study underway)
- Battery Hill (pre-feasibility study underway)
- Graphite Bull (pre-feasibility study underway)
There are sure to be additional developments across the rest of the portfolio and management intends to find accretive transactions that will enhance the Company's value. The portfolio itself has many positive catalysts coming this year and is strategically positioned in clean energy metals projects that can become domestic sources of supply for North America, Europe and Australia.
Final Thoughts
I'd like to thank the board and team of Electric Royalties for your steadfast support while we navigated our wins and challenges during the past five years. As a CEO who founded the company and is personally invested, it pains me to see our valuation where it is today. We are committed to changing that this year by working hard to unlock the value in our portfolio.
To the shareholders who have been on this journey with us and recognize our value proposition, we thank you for your confidence. We believe our shareholders will ultimately be rewarded as our plans for 2025 and beyond come to fruition and market recognition increases.
Thank you for all your support.
Sincerely,
Brendan Yurik
Founder & CEO
Electric Royalties Ltd.
- Battery Mineral Resources Corp. news release dated May 13, 2024
- Manganese X Energy website https://www.manganesexenergycorp.com/lets-talk-canadas-critical-minerals-list-and-methodology/
- Battery Hill: Technical report titled "NI 43-101 Technical Report on the Preliminary Economic Assessment of the Battery Hill Manganese Project, Woodstock, New Brunswick, Canada" with an effective date of May 12, 2022, available under Manganese X Energy Corp.'s profile on sedarplus.ca
- "NI 43-101 Technical Report - Preliminary Economic Assessment (PEA) of the Mont Sorcier Project, Province of Quebec, Canada with effective date of September 8, 2022
- Bissett Creek: Northern Graphite Corporation Bissett Creek Project PEA; Leduc, M; Effective Date December 6, 2013; Further information and technical reports can be obtained through the Northern Graphite profile at www.sedar.com or northerngraphite.com.
- Northern Graphite news release dated November 9, 2022
- World Copper Ltd. news release dated September 9, 2024. The NI 43-101 technical report filed on sedarplus.ca is titled "Resource Estimate for The Zonia Project 2024 Update" with effective date August 27, 2024, amended November 8, 2024. The updated estimate includes 112.2 million short tons grading 0.297% total-copper in the Indicated category (668 million pounds of copper) and 62.9 million short tons grading 0.255% total-copper in the Inferred category (320 million pounds of copper) at a cut-off grade of 0.18%; recoveries of 75% in oxides and 70% in the transitional zone.
- https://www.mining.com/web/tin-price-jumps-after-alphamin-temporarily-ceases-operations-at-bisie-mine-in-congo/
- Kamilli, R.J. et al; Chapter S of Critical Mineral Resources of the United States-Economic and Environmental Geology and Prospects for Future Supply; USGS Professional Paper 1802-S; 2017
David Gaunt, P.Geo., a qualified person who is not independent of Electric Royalties, has reviewed and approved the technical information in this release.
About Electric Royalties Ltd.
Electric Royalties is a royalty company established to take advantage of the demand for a wide range of commodities (lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc and copper) that will benefit from the drive toward electrification of a variety of consumer products: cars, rechargeable batteries, large scale energy storage, renewable energy generation and other applications.
Electric vehicle sales, battery production capacity and renewable energy generation are slated to increase significantly over the next several years and with it, the demand for these targeted commodities. This creates a unique opportunity to invest in and acquire royalties over the mines and projects that will supply the materials needed to fuel the electric revolution.
Electric Royalties has a growing portfolio of 43 royalties in lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc and copper across the world. The Company is focused predominantly on acquiring royalties on advanced stage and operating projects to build a diversified portfolio located in jurisdictions with low geopolitical risk, which offers investors exposure to the clean energy transition via the underlying commodities required to rebuild the global infrastructure over the next several decades toward a decarbonized global economy.
For further information, please contact:
Brendan Yurik
CEO, Electric Royalties Ltd.
Phone: (604) 364‐3540
Email: Brendan.yurik@electricroyalties.com
https://www.electricroyalties.com/
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange), nor any other regulatory body or securities exchange platform, accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward-Looking Information and Other Company Information
This letter includes forward-looking information and forward-looking statements (collectively, "forward-looking information") with respect to the Company within the meaning of Canadian securities laws. This letter includes information regarding other companies and projects owned by such other companies in which the Company holds a royalty interest, based on previously disclosed public information disclosed by those companies and the Company is not responsible for the accuracy of that information, and that all information provided herein is subject to this Cautionary Statement Regarding Forward-Looking Information and Other Company Information.Forward-looking information is typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. This information represents predictions and actual events or results may differ materially. Forward-looking information may relate to the Company's future outlook and anticipated events and may include statements regarding the financial results, future financial position, expected growth of cash flows, business strategy, budgets, projected costs, projected capital expenditures, taxes, plans, objectives, industry trends and growth opportunities of the Company and the projects in which it holds royalty interests.
While management considers these assumptions to be reasonable, based on information available, they may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company or these projects to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks, uncertainties and other factors include, but are not limited to risks associated with general economic conditions; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving the renewable energy industry; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the mining industry generally, recent market volatility, income tax and regulatory matters; the ability of the Company or the owners of these projects to implement their business strategies including expansion plans; competition; currency and interest rate fluctuations, and the other risks.
The reader is referred to the Company's most recent filings on SEDAR+ as well as other information filed with the OTC Markets for a more complete discussion of all applicable risk factors and their potential effects, copies of which may be accessed through the Company's profile page at sedarplus.ca and at otcmarkets.com.
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