Fortune Minerals Limited

09/17/2021 | Press release | Distributed by Public on 09/17/2021 14:30


North of 60 Mining News - September 16, 2021

A battery metal the EV sector cannot live with, or without Critical Minerals Alliances - September 2021

The envisioned green future where every North American is driving a battery-powered electric vehicle charged with renewable energy could be undermined by cobalt, a somewhat scarce and controversial metal that makes lithium-ion batteries better…'Cobalt is considered the highest material supply chain risk for electric vehicles in the short and medium term,' the U.S. Department of Energy penned in an April report…While the sector has made headway in reducing the amount of cobalt needed, the average 100-kilowatt-hour lithium-ion battery pack, the size used to power a Tesla Model S or Model X, currently has roughly 20 kilograms (44 pounds) of cobalt, according to DOE…Benchmark Mineral Intelligence, a world-leading battery supply chain analyst, estimates that a 35 gigawatt-hour lithium-ion battery megafactory requires roughly 6,000 metric tons, or 6 million kg, of cobalt per year…According to the United Kingdom-based firm's June data, more than 200 megafactories are being built, or are in the pipeline to be built in the coming years…With existing battery chemistries, these currently planned lithium-ion battery factories alone would need a staggering 651,000 metric tons of cobalt, which is 465% more than the 140,000 metric tons that the United States Geological Survey calculates was mined globally during 2020…This projected massive growth in cobalt demand is further complicated by the fact that this battery ingredient is seldom mined as a standalone metal. Instead, it is typically produced as a byproduct at copper and nickel mines…Beyond the expectation that the global mining sector will be challenged to keep pace with skyrocketing demand, another impetus to establish North American sources of cobalt is most of this increasingly important battery metal is currently mined in the Democratic Republic of Congo (DRC), a country plagued with political and social issues…It is estimated that artisanal mines are the source of 10 to 20% of the cobalt coming out of DRC, a country that accounts for nearly 70% of the world's supply of this controversial battery metal…This is because roughly 80% of the global production of cobalt sulfate, the upgraded form of cobalt used in lithium-ion batteries, is produced in China…Eliminating cobalt from the lithium-ion battery recipe is akin to developing a gluten-free pizza crust - alternatives are available for those who absolutely cannot have gluten, but it is tough to develop a flourless recipe that has all the attributes that would make all pizza lovers want to eat the pie…'Moving away from high cobalt content means the new cathode materials must be optimized for all of these performance characteristics via subtle changes in the arrangement of the transition metals and their relative compositions,' DOE explained…While government and industry efforts are expected to lower the percentage of cobalt going into each battery, this will not offset the massive volume of batteries to be produced over the coming years and decades. This has battery manufacturers, even those looking to eliminate cobalt from the battery mix, racing to the mines to ensure they have the socially and environmentally responsible supplies of this battery metal…Early in 2019, Tesla cut a deal to buy cobalt from Glencore Plc, the world's largest producer of this battery metal…Samsung SDI, a South Korean lithium-ion battery manufacturer, also cut a deal for Glencore cobalt. Under the terms of this supply contract, Glencore will provide up to 21,000 metric tons of cobalt contained in cobalt hydroxide between 2020 and 2024…In Europe, BMW Group secured a deal for 100 million euros ($119 million) worth of cobalt from Managem Group, a Moroccan mining company the German automaker selected for its sustainable and ethical mining practices…Tesla CEO Elon Musk hinted that his EV company may form closer bonds with mining companies as it seeks to secure cobalt and other battery materials…'We might get into the mining business. I don't know,' Musk said. 'We'll do whatever we have to ensure that we can scale at the fastest rate possible.'…One of the most intriguing of these deposits is at Fortune Minerals Ltd.'s Nico cobalt-gold-bismuth-copper project in Northwest Territories. According to a 2020 plan, a mine at Nico and an associated refinery in a Canadian province such as Saskatchewan would produce an average of 1,800 metric tons of battery-grade cobalt sulfate; 1,700 metric tons of bismuth; 300 metric tons of copper; and 47,000 oz of gold annually over the first 14 years of mining. This mix of critical, precious, and base metals may be an intriguing prospect for those wanting to see more cobalt mined and refined in North America.