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Highlights
- Cobalt Blue secures key cobalt supply deal
- 2025 investment decision targeted
- Global sourcing becomes strategic focus
Cobalt Blue Holdings Ltd (ASX:COB) is making significant progress on its Kwinana cobalt refinery project, aiming to reach a Final Investment Decision (FID) by the end of 2024. The company recently signed a pivotal supply agreement with Glencore International, marking a major step forward in advancing the refinery, which is poised to become a key player within the evolving energy materials sector.
Under the agreement, Glencore will supply up to 50% of the cobalt hydroxide feedstock required by the Kwinana refinery over an initial three-year period. This partnership helps ensure security of supply and reflects a broader shift in sourcing strategy by Cobalt Blue.
Initially, the company planned to rely on domestic feedstock from its Broken Hill project. However, persistent low cobalt prices and global market dynamics prompted a reassessment. According to CEO Dr Andrew Tong, around 76% of the world's cobalt production in 2023 came from the Democratic Republic of Congo (DRC), emphasizing the strategic necessity of international procurement.
The Kwinana refinery, once operational, will produce cobalt sulfate for battery applications and cobalt metal for use in superalloys and defense. This diversified end-use is designed to align with both current and future cobalt demand trends. While electric vehicle (EV) sales have recently softened, demand for cobalt in other industrial and defense applications remains robust.
Adding further credibility to its plans, Cobalt Blue successfully processed a five-tonne cobalt sample from Glencore at its Broken Hill demonstration facility. The trial run produced both cobalt sulfate and cobalt metal, validating the refinery’s proposed production capability.
As the company navigates toward its FID, it continues to work on finalizing key steps such as offtake agreements, financing arrangements, and broader seed partnerships. The project is being advanced as a joint venture with Japan-based Iwatani Corporation, which is set to hold a 30% stake. Cobalt Blue’s near-term focus includes supporting Iwatani’s strategic engagement in Japan and securing backing from global debt agencies.
For investors following high-potential opportunities in the ASX300, Cobalt Blue’s progress presents an important case study in navigating the shifting landscape of energy transition materials. Meanwhile, for those seeking stability in their portfolios, insights into ASX dividend stocks can offer a complementary strategy amid evolving commodity market dynamics.
With 2025 as a targeted milestone, Cobalt Blue’s trajectory signals a bold step toward strengthening Australia’s role in the global cobalt supply chain.
