Global cobalt and nickel supplier Jervois (ASX:JRV) reports its Bankable Feasibility Study (BFS) for a proposed refinery expansion at the Kokkola Industrial Park in Finland will be redirected to be a study for a greenfield cobalt refinery in the US.
The company reports its technical team in Finland along with consulting company AFRY Finland Oy have designed a BFS flowsheet for an initial refinery capacity of 6,000 metric tonnes per annum (tpa) of contained cobalt in sulphate form for electric vehicles (EVs). AFRY will continue to provide specialist refinery expertise and leadership from Finland, but with the BFS to be run out of AFRY USA.
Jervois USA’s team in Salmon, Idaho will provide specialist support for the US BFS across key areas such as environmental and permitting, logistics, utilities, and construction readiness, while Jervois Finland will continue to provide stewardship of the BFS.
Jervois reports the US Inflation Reduction Act of 2022 (IRA) is a ‘landmark’ piece of federal legislation designed to increase domestic extraction and processing rates of key battery materials and critical metals including cobalt.
As the IRA is designed to stimulate the US domestic cobalt refining and recycling activities, Jervois expects its future US cobalt refinery to benefit from a 10% operating cost credit for the duration of its operating life. Despite initial steps by Europe through its recent 2023 European Union Critical Raw Materials Act and Net Zero Industry Act, this represents a material competitive advantage over facilities not located in the US.
Jervois says it is encouraged by discussions with the US Department of Energy regarding various loan and grant programs
Additionally, Jervois says it is encouraged by discussions with the US Department of Energy regarding various loan and grant programs that are expected to be available to support refinery construction.
As previously announced, Jervois says it will continue to work through the final documentary steps to formalise a US Department of Defence (DOD) intention to award US$15 million under the Defense Production Act (DPA) Title III programs. This grant is expected to fully fund the US cobalt refinery BFS, as well as the proposed drilling program at the Idaho Cobalt Operation.
If Finland and the European Union provide ‘meaningful’ financial support and incentives similar to those offered in the US, Jervois says the Kokkola expansion BFS can be retained by Jervois Finland and AFRY. Based on customer engagement, the company says it has visibility on future cobalt demand requirements in the US and Europe that is expected to be able to support construction and commissioning of both facilities.
Jervois reports negotiations with automakers in the US and Europe are continuing to advance, and the company says it expects to finalise initial long term cobalt sulphate contracts from Jervois Finland existing production capacity in both jurisdictions during 2023.
Current Jervois Finland cobalt sulphate sales into the battery sector are sold on either annual or short-term contracts, primarily through long standing relationships in Japan. The company expects refinery expansions in either the US or Europe will be funded by third parties through a combination of government and customer support.
Jervois is a global cobalt and nickel supplier that is developing a fully integrated cobalt value chain. The company currently operates the Idaho Cobalt Operations in the US, the Sāo Miguel Paulista Refinery in Brazil, and the Nico Young Nickel Cobalt Deposit in New South Wales. The company also manufactures cobalt powders and cobalt-based inorganic salts and oxides at its production facility in Finland.
Images: Jervois Global Ltd
