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Junior battery metals explorer Australian Vanadium has discovered it can recover cobalt, along with nickel and copper, during test work at its Gabanintha project in Western Australia.

The news delighted investors, with the share price gaining nearly 10 per cent to trade at 4.5c on Tuesday morning.

Cobalt pricing is at all-time highs due to its position as a strategic battery metal.

Increasing demand for cobalt — especially ethically sourced cobalt — has pushed the price up to $US90,500 ($119,339) per tonne.

Battery metal price analyst Benchmark Mineral Intelligence expects the use of cobalt in lithium-ion batteries to triple between now and 2026.

Being able to recover cobalt means Australian Vanadium (ASX:AVL) could increase future revenue from the Gabanintha project, which is primarily a vanadium project.

“Since we initially identified this opportunity, we have been interested in its implications for the project,” managing director Vincent Algar told investors.

“Adding a high-value battery focused metal to the product suite at Gabanintha could potentially prove an important revenue stream, further enabling AVL’s Gabanintha project to be on the lowest end of the vanadium cost curve.”

Australian Vanadium (ASX:AVL) shares over the past six months.
Australian Vanadium (ASX:AVL) shares over the past six months.

Australian Vanadium was able to produce sulphide concentrates containing 1.54 to 2.02 per cent cobalt, 1.36 to 2.58 per cent nickel and 0.82 to 1.7 per cent copper.

Anything over 2 per cent is considered high grade for cobalt and nickel. Over 1.5 per cent is high-grade for copper.

The company is now preparing a resource update, which will contain sulphur and base metals, to include these components in the pit-optimisation and pre-feasibility studies already underway.

Australian Vanadium also plans to meet with potential Australian and offshore buyers to discuss terms for the sale of a sulphide concentrate.

Stockhead is seeking further comment.