Ground Breakers: The theme of the day is getting s**t done
Friday is generally a great time to wind down, work from home and ignore the emails you don’t have to answer. Right?
Not when there’s literally hundreds of mines that need to be built to cater for what has been termed a shortage of molecules to keep pace with electrification and industrial growth.
Today’s offerings include a new cobalt mine in Idaho, a long-delayed mineral sands operation near Derby in WA’s north, and World Bank funding for a new lithium operation in Argentina.
Jervois Global (ASX:JRV) has taken the unusual path of being a cobalt focused producer, a lightly traded commodity largely mined in Africa which is essential to the standard NCM chemistry lithium-ion battery.
That makes it a critical mineral just about anywhere you look, including on the US Government’s list, including in the Biden Administration’s 100-day review in June 2021.
Jervois will officially open the mine today, with commissioning taking place throughout October and across Q4.
Once it hits nameplate capacity at the end of the March quarter, the Idaho Cobalt Operations will be the only primary cobalt mine in the United States, producing a cobalt concentrate for use in electric vehicles, energy generation and distribution, defence and elsewhere.
The operation in Salmon, Idaho, is expected to produce 1915t of cobalt, 2900t of copper and 6700oz of gold per year with an initial seven-year mine life.
It comes on top of Jervois’ exiting operations in Finland, where it expects to sell 5500-5750t of cobalt in 2022, Sao Miguel Paulista Refinery in Brazil and undeveloped Nico Young deposit in Australia.
Sheffield Resources (ASX:SFX) and its PR people have clearly been waiting a long time to say Thunderbird is go.
It isn’t quite, but we do now finally have a final investment decision on the zircon rich Kimberley mineral sands deposit, which will make its first shipment in Q1 2024 after a $379 million stage 1 development.
That is around $16m higher than a BFS released earlier this year, though long term zircon prices have been revised up from US$1516/t to US$1607/t, with mineral sands commodities commanding strong prices amid a market expected to face extreme supply shortages in the coming years.
The decision to proceed with the construction of the mine today came after SFX secured funding for the operation, 65% or $315 million in the form of loans from the Northern Australia Infrastructure Facility and Orion Mine Finance, $154m from 50% Chinese JV partner Yansteel and $34m in equity from SFX with a total funding requirement of $484m.
The mine is projected to run for 36 years, producing around 3.5% of global ilmenite supply for conversion into titanium dioxide pigment and 6.5% of world zircon supply, used in refractories, foundry casting and tiling, along with emerging use in catalytic converters and air and water purification.
Lithium and coal are two commodities, ironically, both in short supply for different but intertwined reasons.
Right now big coal and lithium companies are rising nigh on every day, breaking new records in the midst of a both a crunch in fossil fuel supplies and an expansion of investment in technologies to avoid burning fossil fuels.
Allkem (ASX:AKE) wants to maintain a 10% share of global lithium supply it currently holds via the Olaroz and Mt Cattlin mines in Argentina and WA, respectively.
And it has plans to expand over the next four years with the development of the Sal de Vida brine operation in Argentina, Naraha lithium hydroxide plant in Japan and James Bay spodumene mine in Canada.
The most advanced of the two proposed mines is Sal de Vida, which took another step forward with the announcement of a US$200 million finance facility for the first stage of the development from the World Bank’s International Finance Corporation.
“We are already in a strong financial position to self-fund the Sal de Vida project however we saw an opportunity to further improve the financing structure for Sal de Vida and partner with IFC, an institution with decades of experience providing finance and sustainable business solutions in the mining space,” Allkem boss Martin Perez de Solay said.
Allkem has around US$664m in cash, something only expected to grow with lithium prices at all-time highs.
Sal de Vida is expected to produce 15,000tpa of mostly battery grade lithium carbonate at a capital cost of US$271m, with construction started in January this year and first production due in the second half of 2023.