Cobalt Blue Faces Market Volatility Amid DRC Export Ban and Leadership Changes

Kwinana Refinery Nears Critical Milestone

Cobalt Blue Holdings Limited (ASX: COB) has reported significant progress on its flagship Kwinana Cobalt Refinery project in Western Australia. With 80% of detailed plant engineering completed by Tetratech, the company is advancing steadily towards a Final Investment Decision (FID), targeted for 31 December 2025. The recent execution of a binding pre-FID Consortium Deed with Iwatani Australia Pty Limited formalises the collaborative framework to progress the project, contingent on technical, commercial, and financing conditions.

Offtake negotiations continue with prospective buyers for cobalt sulphate and cobalt metal, although near-term procurement decisions remain cautious due to uncertainties in global supply chains and manufacturing locations. Meanwhile, permitting processes are underway, with modifications to the Works Approval lodged and public consultation completed.

Strategic Diversification via Halls Creek Earn-In Agreement

In a strategic move to broaden its commodity exposure beyond cobalt, Cobalt Blue entered an earn-in agreement with AuKing Mining Limited for the Halls Creek Project, a polymetallic asset rich in copper, lead, zinc, silver, and gold. The project, located in the Kimberley region of Western Australia, offers strong logistical advantages and a robust mineral resource base.

The company has commenced a scoping study to evaluate development options for the Sandiego and Onedin deposits, leveraging over A$20 million of historical exploration investment. This diversification aims to mitigate cobalt market cyclicality and enhance financial resilience, positioning COB to capitalise on multiple commodity cycles.

Market Dynamics: Cobalt Price Surge Amid DRC Export Ban

The cobalt market experienced a structural shift during the quarter following the Democratic Republic of Congo's temporary export ban, the world's largest cobalt producer. This intervention led to a sharp price spike of 50-120% across cobalt products. While the ban introduces short-term supply constraints, it is expected to rebalance the market and support sustained price recovery, especially as electric vehicle sales surged 29% year-on-year in Q1 2025, underpinning robust demand fundamentals.

Corporate Updates: Leadership Transition and Cost Management

Post-quarter, Cobalt Blue announced a leadership transition with CEO Joe Kaderavek moving to Deputy Chairman and Dr Andrew Tong stepping into the CEO role. The company also appointed Kelvin Bramley as CFO and Company Secretary earlier in the year. In response to operational reviews and market conditions, COB implemented cost-saving measures including headcount reductions and salary cuts of 25-30%, offset partially by employee share schemes. These actions are expected to yield annualised savings of approximately $2.3 million.

Financially, the company raised $520,000 through an entitlement issue and secured a $700,000 loan facility against its forecast Research and Development Tax Incentive refund. Government grants totaling $1.5 million are also supporting ongoing activities. Despite ongoing negative operating cash flows, COB maintains a cash balance of $2.1 million at quarter-end, with funding sufficient for less than one quarter at current expenditure levels.

Looking Ahead

Cobalt Blue is preparing for a pivotal year ahead, with the Kwinana Refinery FID decision, Halls Creek scoping study completion, and evolving cobalt market dynamics all set to shape its trajectory. The proposed corporate rebrand to Core Blue Minerals Limited reflects its broadened commodity focus and strategic ambitions.