PERTH (miningweekly.com) – Strategic metals developer Cobalt Blue has reported a near A$70-million capital cost savings for its Broken Hill cobalt project, in South Australia, while the production target for the project has been increased by some 67%.

Cobalt Blue on Thursday noted that an updated project study had delivered significant enhancements compared with the 2018 prefeasibility study on the project, including a 55% increase in the ore reserves, which now stood at 71.8-million tonnes at 710 parts per million (ppm) cobalt, and a 34% increase in ore reserves, which now stood at 51 000 t.

The updated study has estimated that the preproduction capital expenditure for the project would now be around A$560-million, some A$70-million less than previously expected, inclusive of an increase in the front-end mining and concentrate throughput capacity from 2.25-million tonnes to 6.3-million tonnes.

The production target for the project has increased from 58.7-million tonnes at 802 ppm cobalt to 98-million tonnes at 690 ppm cobalt, with contained cobalt increasing from 47 000 t to 67 000 t.

The project’s projected operating life has also increased from 13 to 17 years, with average annual production expected to reach between 3 500 t/y and 3 600 t/y of cobalt.

Based on the production target, C1 cash costs are estimated to reach A$10.34/lb while all-in sustaining costs have been estimated at A$13.10/lb.

Also based on the production target, the Broken Hill project is estimated to have a post-tax net present value of A$490-million.

“We are pleased to announce this substantial project update 2020 for the world-class Broken Hill cobalt project. The study demonstrates strong potential for Cobalt Blue to become a significant low cost, and ethical supplier of premium cobalt sulphate to the lithium-ion battery industry,” said chairperson Rob Biancardi.

He noted that while the company was pleased with the results from the study, there remained key optimisation opportunities that would be examined during the feasibility study, including further capital cost reductions, project life extensions, lower cost energy alternatives, and increased metal recoveries.