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Global Cobalt Market Expected to Grow as Demand for Lithium-Ion Batteries Increases

V.EVX, T.TMQ, V.ELBM

FinancialBuzz.com News Commentary

PR Newswire

NEW YORK, October 11, 2018 /PRNewswire/ --

According to data compiled by Stratistics MRC, the global cobalt market is expected to grow at a CAGR of 10.3% during the forecast period from 2017 to 2026. The rising demand is attributable to the emergence of lightweight electric vehicles, usage in the medical sector and demand for cobalt alloys in aircraft engines. Cobalt is also a primary element used within lithium-ion batteries, which are heavily used in electronic manufacturing. Additionally, many everyday consumer electronics such as phones, laptops and tablets also use lithium-ion batteries. The demand for batteries in electric vehicles is expected to propel the market heavily. The batteries are highly attractive because they are environmentally efficient, providing a cleaner alternative to traditional energy sources. European Electric Metals Inc. (OTC: EVXXF), Trilogy Metals Inc. (NYSE: TMQ), PolyMet Mining Corp. (NYSE: PLM), First Cobalt Corp. (OTC: FTSSF), eCobalt Solutions, Inc. (OTC: ECSIF)

Currently, the consumer electronics segment dominates the lithium-ion market, but as the emergence of electric vehicles approaches, the vehicle market will shortly take over. Many automotive manufacturers are looking to transition to lithium-ion powered vehicles due to environmental concern and government regulations being implemented. The consumer electronics segment is still expected to witness continued growth during the forecasted period despite the electric vehicle market taking over. "I still believe the critical point [for the cobalt market] will be in 2020, when the majority of the electric vehicles are going to come to market," said Caspar Rawles, analyst at Benchmark Mineral Intelligence. "I don't think there are any factors that could derail the cobalt story at this point."

European Electric Metals Inc. (OTC: EVXXF) is also listed on the TSX Venture Exchange under the ticker (TSX-V: EVX). Just announced breaking cobalt news that, "it has entered into an agreement to acquire 100% of the issued and outstanding shares of Gerold Sh.pk. ("Gerold"), an arm's length party, which holds the Skroska Iron-Nickel mine ("Skroska") in Albania.

Gerold previously ran a 200 tons per day mine at Skroska, a fully permitted mining operation covered by a 20-year mining license, which was issued in 2008. Gerold conducted mining operations on Skroska from 2008-2013 using an open stope method. The operation previously focused on nickel production and the mine was put on care and maintenance in 2013 due to low nickel prices. EVX's geological team believed there was potential for high-grade cobalt in this geological setting and during sampling realized this potential.

All underground infrastructure and mining equipment necessary to conduct mining operations is in place, owned and onsite. The mine is 16 kilometers on a paved road to a rail loading station that connects the mine to a shipping port. In addition to the commencement of mining operations, the Company will also target to confirm and expand the historic resource through drilling and undertake a study to evaluate an expansion of the historic mining rate.

EVX geologists investigated the possibility of higher-grade cobalt zones at Skroska, believing there may be similarities between mineralogy of Skroska laterite deposit and the Geovic's Cameroon laterite deposit. During sampling at the Skroska the EVX geological team took 18 laterite samples collected from 10 different underground locations. The assays ranged from 0.05% to 0.54% Co and from 0.36% to 1.92% Ni. Ten of these samples assayed 0.15% Co and above and are shown in the table below. The presence of this cobalt-rich laterite had not been previously recognized at Skroska.

…The samples were taken vertically from the pillars/columns of the mine and have widths varying from 0.40 meter to 1.10 meters. Where two samples have the same preceding number (i.e. 7A and 7B) it means they were taken from the same location and are contiguous. The majority of the samples were collected at Level-815 of the underground mine, with three samples taken at Level-850. The sampling program covered a lateral distance of approximately 420 meters. The location of the samples and their corresponding assays are shown in the Company's website (http://www.europeanelectricmetals.com).

The samples were sent to ALS Lab in Serbia for preparation and sent to their laboratory in Ireland for analysis. The analytical suite selected was ME-XRF12n. This analytical suite is suitable in the analysis of ore grade nickel laterite samples.

Mr. Fred Tejada, EVX CEO and Director states, "We are excited our geological team recognized the potential for the cobalt-rich horizons at Skroska and very pleased that this potential has been confirmed in the sampling program, via high grade cobalt results. This transaction represents a major step towards our goal of becoming an ethical source of high-grade cobalt production, within a European setting."

The Skroska Mine - The Skroska deposit had a historic resource of 22.4 million tons grading 0.99% Ni, 50% Fe and 0.065% Co. The reserve is historic in nature (see note below). The laterite deposit ranges from 2 meters to 10 meters in thickness and averages 6 meters thick. It occurs between the ultramafic rocks (serpentinized) below and limestone on top or as a capping. The limestone is a competent rock which makes it a natural roof for the open stope underground mining method employed in the mine. Approximately 100,000 tons were mined by Gerold at an operating rate of 200 tons per day and 55,000 tons were shipped to China, while about 15,000 tons in Macedonia (information provided by Gerold Sh.pk. personnel). The rest of the mined materials are stockpiled in the mine site (the stockpile is not included in the Agreement). Prior to Gerold, mining was conducted by a state-run enterprise from 1985 to 1990 extracting 1.054 million laterite ore and delivering to the Elbasan Ferro-Nickel smelter some 58 kms to the west of the mine (based on available government information).  

Based on the sampling done by EVX in July 2018, the mine openings (haulage, development and production areas) were observed to be accessible and free of major blockages. Electrical power supply to the underground areas was available while major mine equipment both inside the underground works and on the surface were observed to be in good condition and are reported to be operational. The Company's geologists persisted in looking at the possibility of higher grade in some of the deposits similar to grades in the Geovic Cameroon deposit. Having had indications of elevated Co in prospecting done, the Company's geologists conducted a 2-day sampling program in Skroska in July. EVX geologists sampled the appropriate horizons and came back with very high cobalt grades.

Cobalt has not been a significant contributor in the past as all the laterite production in Albania was processed for nickel and iron. Historically, prior to Albania building its own smelter in 1976 in Elbasan, the laterite ore was shipped to China and Czechoslovakia. The Company has 4 months to conduct due diligence study which will include among others a study to determine if mining operations can be re-started within 6 to 12 months. Historical resource estimates are not mineral reserves and do not have demonstrated economic viability…

Note: The tonnage and grade estimates stated above are historic in nature and were obtained from the records at the Albanian Geological Survey. The estimate done, using Russian Style Polygon method, are roughly equivalent to the National Instrument 43-101 inferred category. No qualified person has done sufficient work to classify the historical estimates as current mineral resources. EVX considers the historical estimates relevant in guiding exploration efforts and planning although EVX is not treating the historical estimates as current mineral resources. EVX will need to undertake a comprehensive review of available data, including further drilling, to verify the historic estimates and classify them as current resources.

Jose Mario Castelo Branco, EuroGeol, a Qualified Person under the meaning of Canadian National Instrument 43-101 and Chief Geologist of the Company is responsible for the technical content of this news release.

About European Electric Metals Inc. - European Electric Metals Inc. is a Canadian listed public company, with a focus on electrification themed projects in Europe. A major shareholder of EVX is the European Bank for Reconstruction and Development. The goal of EVX is to become a major source of battery metals such as copper, nickel and cobalt, and the Company seeks to do so within safe, stable and logistically attractive European jurisdictions. The Company's projects are ideally located with excellent road, port and grid power availability, and near European countries that are poised to experience dramatic growth in the electric-vehicle-manufacturing industry. There is a strong battery-manufacturing industry within Europe with many more projects in the pipeline."  

Trilogy Metals Inc. (NYSE: TMQ) is a metals exploration and development company focused on exploring and developing the Ambler mining district located in northwestern Alaska. Trilogy Metals Inc. recently announced that the first set of high-grade copper and cobalt assay results from this summer's exploration diamond drilling program at the Bornite Project, a part of the Company's Upper Kobuk Mineral Projects ("UKMP") located in the Ambler mining district of Northwest Alaska. Sample results from these four holes comprise approximately 3,871 meters from the recently completed 10,123-meter drill campaign.  All four drill holes contain copper mineralization and were designed as infill holes to the 300 to 400-meter step-out holes drilled by the Company's previous round of drilling completed in 2017. Rick Van Nieuwenhuyse, President and Chief Executive Officer of Trilogy Metals commented, "We continue to see narrow zones of high-grade copper and cobalt mineralization overlain by broader zones of lower grade mineralization at Bornite.  The continuity of the mineralized envelop continues to impress.  With another eight holes of results due to come out over the next several weeks, we will continue to release results as they become available.  After all results are in, we expect to complete an updated resource estimate at Bornite in the first half of next year."

PolyMet Mining Corp. (NYSE: PLM) is a publicly traded mine development company that owns 100% of Poly Met Mining, Inc. Poly Met Mining Inc. reported earlier this year that it has filed an updated technical report with Canadian and U.S. securities agencies that reaffirms the economic and technical viability of the NorthMet copper-nickel-precious metals project located near Hoyt Lakes, Minnesota. Capital costs for Phase I are estimated at USD 945 Million and include refurbishment of the existing primary crushing circuit and replacing the existing rod and ball mill circuits with a new, modern semi-autogenous grinding (SAG) mill, ball mill and flotation circuit. It also includes rail upgrades, mining equipment and a state-of-the-art wastewater treatment plant. Phase II involves the construction and operation of a hydrometallurgical plant to treat nickel sulfide concentrates into upgraded nickel-cobalt hydroxide and recover additional copper and platinum-group metals. While the development of Phase II will be at the Company's discretion, both phases are currently being permitted and are included in the Final Environmental Impact Statement and draft permits. Phase II would increase the project's capital costs by approximately USD 259 Million. "This report reaffirms the technical and financial viability of the 32,000 tpd case for which the final EIS and draft permits have been issued. Our focus remains on obtaining final permits under the 32,000 tpd permit case, meeting our environmental and financial assurance obligations under the terms of those permits, and obtaining the necessary financing to build the project," said Jon Cherry, President and Chief Executive Officer. "We are making significant progress on all of those fronts."

First Cobalt Corp. (OTCQX: FTSSF) is a vertically integrated North American pure-play cobalt company. First Cobalt Corp. recently announced drill results from its Iron Creek Cobalt Project in Idaho, USA. Results reported highlight a high-grade zone at the western extent of the current Inferred Resource, which remains open along strike and at depth. Highlights include: Drilling confirms cobalt and copper metal zonation, including higher grade copper and cobalt zones; High-grade copper (Cu) intercepts include 10.0m of 4.04% Cu and 8.0m of 3.16% Cu, including 1.4m of 6.56% Cu and 20.5 g/t Ag; cobalt (Co) intercepts include 1.04% Co over 1.5m and 0.51% Co over 4.1m; Cobalt remains the dominant resource metal with higher grade cobalt zones towards the eastern extent of known mineralization and copper-rich zones to the west; Higher grade copper and cobalt zones within broader zones of mineralization provide optionality for development. Trent Mell, President & Chief Executive Officer, commented: "High grade cobalt and copper zones within wider mineralized zones, such as those reported here, expand our options for development as we look to the future of this project. As work advances, I am repeatedly impressed by the increasing potential of this resource and look forward to updating our mineral resource estimate in early 2019 with results from the ongoing program."

eCobalt Solutions, Inc. (OTCQX: ECSIF) is a Toronto Stock Exchange listed company committed to providing clean cobalt products essential for the rapidly growing rechargeable battery and renewable energy sectors, made safely, responsibly, and transparently in the United States. eCobalt Solutions Inc. recently reported that construction continues to advance on time and on budget at its Idaho Cobalt Project, located near the town of Salmon, in the heart of the historic Idaho Cobalt Belt. The ICP remains the sole, near-term, environmentally permitted primary cobalt deposit in the United States. "Our main priority is finalizing all environmental systems at site in preparation for underground mine development in early 2019," stated Paul Farquharson, President & Chief Executive Officer of eCobalt. "This includes getting the Water Treatment Plant in place, the liner installed on the Tailings Waste Storage Facility and Water Management Ponds, and electrifying the pump back wells. These activities are part of the use of proceeds from the February 2018 public offering and are expected to be completed in the fourth quarter of this year. I am pleased to report that we are advancing on time and on budget as our team has been working expeditiously during the summer months."

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