Fortune Minerals scales back Nico development on weak cobalt prices
The price of cobalt has taken a hard hit because an oversupply of the mineral that is critical to batteries used if electric vehicles. In January, the price of cobalt was $47,000/t but it has since fallen to about $35,470/t.
The price decrease has led a number of companies to reevaluate their cobalt mines, including Canada’s Fortune Minerals Ltd which said it would shelve plans to upsize its early-stage cobalt mine in the country’s far north while it continues to hunt for a strategic partner, Reuters reported.
The Nico development is in Canada’s Northwest Territories
Falling prices for the critical battery ingredient prompted Glencore in August to halt output for two years at its giant Mutanda copper and cobalt mine in the Democratic Republic of Congo.
London, Ontario-based Fortune Minerals said current prices do not justify expanding the daily mill production rate to 6,000 tonnes from 4,650 tonnes at its proposed Nico project, which would also produce gold and bismuth.
“An environment that has seen curtailment from the world’s largest cobalt mines is not conducive for an expanded, capital intensive project at this time,” Chief Executive Robin Goad said in a statement. “However, the world continues to transition to electric mobility and will require new sources of cobalt that are independent of the Congo to meet the increase in demand from the battery sector. Fortune is optimizing its NICO development to be more robust at various cobalt prices and position the company to support the transformation of the auto industry.”
Fortune is continuing discussions with potential strategic partners interested in a reliable North American supply of cobalt, gold and bismuth, while optimizing the development plans for NICO in an environment of metal price volatility. Fortune will continue to advance the NICO Project and position the development to support the transformation of the global automotive industry to electric mobility with an attractive gold co-product.