Cobalt Blue Holdings (ASX: COB) has announced that it has entered into an agreement with Mitsubishi Corporation for market evaluation of elemental sulphur from its Broken Hill Cobalt Project in western New South Wales.
With this agreement, COB is aiming to be a long-term supplier of elemental Sulphur for more than 15 years at 300,000 t/yr.
The company said that this early stage trial product agreement between COB and Mitsubishi Corporation represents a development milestone towards potential future offtake arrangements for elemental sulphur.
Australia’s annual consumption of sulphuric acid estimated is to be over ~5m tpa, which is currently supported by importing over 1m tpa of elemental sulphur. COB said that it is looking to partially displace the supply of elemental sulphur imported into Australia.
COB noted that strong demand growth is forecast over the next decade from both fertiliser and metallurgical demand.
Broken Hill (Thackaringa) cobalt project
The Broken Hill (previously called as Thackaringa) Cobalt Project covers an area of 63km2 and is located in western New South Wales and 23km west of Broken Hill.
The portfolio of tenements comprises Exploration Licence 6622 (1992) (EL 6622), Exploration Licence 8143 (EL8143), Mining Lease 86 (1973) (ML 86) and Mining Lease 87 (1973).
All leases are 100% owned by Broken Hill Prospecting Ltd (BPL) and are subject to a farm in agreement with Cobalt Blue Holdings Ltd.
COB targeting increased production
COB announced that it is developing the Broken Hill Cobalt Project and is targeting production of up to 4,000 tpa of cobalt and 300,000 tpa of elemental sulphur.
COB said that it is aiming to be a new supplier of elemental sulphur. Since the project is located in Australia, COB said that the supply will be close to the end-user markets throughout South-East Asia.
The company said that the sulphur will be in a prilled formed, suitable for long-distance transport and rehandling, without production of excess dust or fine particulates.
COB to displace supply of imported sulphur
It may be noted that Australia’s annual consumption of sulphuric acid estimated is to be over ~5m tpa, which is currently supported by importing over 1m tpa of elemental sulphur.
The elemental sulphur imported into Australia is principally sourced from Vancouver, Canada. COB said that it is looking to partially displace this supply.
COB noted that strong demand growth is forecast over the next decade from both fertiliser and metallurgical demand.
Agreement with Mitsubishi
Mitsubishi Corporation is active global sulphur and sulphuric acid market traders, currently holding a significant share of Asian sulphur and sulphuric acid market.
COB has now entered into an agreement with Mitsubishi to conduct marketing trials for the elemental sulphur.
COB reported that it intends to produce up to 100 t of elemental sulphur from bulk metallurgical testwork trials over the period to 31 December 2020.
Once the trials are successful, both COB and Mitsubishi Corporation are planning to negotiate an offtake contract for the commercial production and sale of elemental sulphur from the Broken Hill Cobalt Project.
COB to produce sulphur
COB announced that it will develop the Broken Hill Cobalt Project using minerals processing technology replacing the production of sulphuric acid with elemental sulphur.
COB said that choosing to produce elemental Sulphur has many advantages. The transport and storage and handling of elemental sulphur is relatively straightforward, hence permitting and approvals applications are simplified for elemental Sulphur; elemental sulphur is railed to an existing port logistics hub in South Australia; and capital costs for elemental sulphur recovery compare favourably against the much larger capital requirements of a Sulphur roasting and an associated acid making plant.
Recent developments and future plans
COB reported that as part of the 2017 Scoping Study, 2018 Pre-Feasibility Study, and recent studies in 2019, it has produced approximately 75 kg of elemental sulphur to date. The Company said that it is working with Enersul (based in Calgary Canada) to turn the powdered Sulphur into prills.
