Jervois Global Ltd. said it has suspended final construction and full concentrator commissioning at its Idaho Cobalt Operations mine (ICO) in Idaho, USA, due to continuing low cobalt prices and inflationary impacts on construction costs. The company said it believes cobalt prices and demand will improve as a result of the green energy transition. It also expects Western cobalt purchasers will increasingly prefer cobalt from sources with Western ESG credentials, particularly given the concentration of supply from the Democratic Republic of Congo and China.
The U.S. Department of Defense (DOD) has advised Jervois that it intends to award it an immediate need for Defense Production Act (DPA) Title III with $15 million of funding. Jervois applied for the DOD award monies to accelerate its drilling aimed at increasing the ICO mineral resource and reserve, and for studies to assess construction of a U.S. cobalt refinery; both can proceed despite ICO’s suspension. Jervois said it views the DOD’s intention to issue its award as an indication of the importance to the U.S. Government of securing its cobalt supply chain.
Jervois said it will immediately begin demobilization of construction contractors from ICO’s site which is expected to be completed in the coming weeks. The total workforce including contractors will reduce from approximately 280 to less than 30, which represents a fit-for-purpose workforce to maintain the site in compliance with its regulatory requirements. Where practical, Jervois said it will look to reassign local ICO employees to the activities to be funded by the DOD award.
Last week, the company reported the mine component of ICO’s construction has been completed. Underground stoping has already produced a stockpile of more than 30,000 tons of ore ready for processing.