Cobalt Blue Lifts Kwinana Refinery NPV to A$155m, Raises A$5.3m Capital

Kwinana Refinery Revaluation Lifts Project Economics

Cobalt Blue Holdings Limited has reported a significant uplift in the financial metrics of its flagship Kwinana Cobalt Refinery (KCR) project following a comprehensive re-evaluation of key parameters. The company revised its feedstock assumptions to focus solely on cobalt hydroxide and diversified its product mix to include cobalt metal alongside cobalt sulphate. These changes have boosted the post-tax net present value (NPV) from A$90 million to A$155 million and increased the internal rate of return (IRR) from 23% to 32%, reflecting a stronger economic case for the refinery's near-term development.

The refinery’s planned capacity remains at 3,000 tonnes per annum of cobalt, now split between 2,000 tonnes as cobalt sulphate and 1,000 tonnes as cobalt alloy-grade metal. Capital costs are unchanged at A$60 million, with commissioning expected to take up to 12 months at half throughput capacity. These refinements position the Kwinana Refinery as a versatile and economically robust facility, ready to meet evolving market demands.

Capital Raise and Strategic Partnerships Bolster Progress

In December 2025, Cobalt Blue successfully completed an oversubscribed placement, raising A$5.3 million before costs. This capital injection provides a solid financial platform to advance the company’s activities through 2026, including progressing towards a final investment decision (FID) for the Kwinana Refinery. The company is actively engaging with globally significant buyers across the USA, Japan, and France, having secured non-binding letters of intent covering approximately 70% of the refinery’s initial production capacity. These offtake agreements are critical milestones that underpin project financing and commercial viability.

Additionally, Cobalt Blue continues to strengthen its feedstock supply chain. Under a contract with Glencore International AG, Glencore will supply up to 50% of the refinery’s cobalt hydroxide requirements for three years post-commissioning. The company is also exploring the use of battery black mass, material recovered from recycled lithium-ion batteries, as a strategic feedstock, enhancing operational flexibility and aligning with sustainability trends.

Environmental and Technological Advances at Broken Hill

Progress on the Broken Hill Cobalt Project (BHCP) includes advancing environmental permit applications with the New South Wales Department of Climate Change, Energy, the Environment and Water, with submissions planned for 2026. The BHCP remains a cornerstone asset, recognised as nationally significant by the Australian Federal government.

The Broken Hill Technology Centre (BHTC) continues to serve as an innovation hub, validating battery black mass as a viable feedstock for the Kwinana Refinery. The centre is scaling up from bench tests to continuous processing circuits capable of producing cobalt metal, nickel hydroxide, and manganese sulphate. This initiative not only supports the refinery’s feedstock diversity but also opens potential near-term revenue streams and broadens the company’s critical minerals portfolio.

Market Dynamics and Strategic Importance of Cobalt

The cobalt market has tightened sharply following export restrictions imposed by the Democratic Republic of Congo (DRC), which controls a significant portion of global supply. Export quotas for 2026 and 2027 are set at less than half of 2024 production levels, creating a structural supply deficit estimated at around 10,700 tonnes for 2026. This supply squeeze has driven cobalt prices up by approximately 120% in 2025, making cobalt one of the best-performing commodities of the year.

These market conditions have shifted cobalt hydroxide and cobalt metal pricing dynamics, with refiners increasingly sourcing cobalt metal for sulphate production. Government stockpiling initiatives in the US and China further add to market tightness and price volatility. Cobalt’s critical role in electric vehicle batteries, defence, aerospace, and emerging technologies underscores its strategic importance in the global energy transition and supply chain security.

Corporate Developments and Outlook

Leadership changes include the retirement of long-serving Chairman Rob Biancardi and the appointment of Joe Kaderavek as the new Chair. CEO Dr Andrew Tong joined the board in October 2025, reinforcing the company’s executive team. The company also repaid its final promissory note instalment, clearing prior financial obligations related to the acquisition of full ownership of the Broken Hill Cobalt Project.

Looking ahead, Cobalt Blue is preparing for an Extraordinary General Meeting scheduled for 6 February 2026, where shareholder approval for placement options will be sought. The company’s strategic initiatives, combined with robust market fundamentals, position it well to capitalise on the growing demand for sustainably sourced cobalt and related battery materials.