Cobalt Blockchain Inc (COBC) has negotiated a cobalt supply agreement with a large local mining cooperative in Lualaba province of the DRC. Starting this June, COBC will be annually supplied a minimum of 40,000 tonnes of cobalt concentrate with a minimum grade of 1% cobalt.
COBC president and chief operating officer Lance Hooper said, “This is a significant milestone in our strategy to generate near-term cash flow. Supply agreements with established mining cooperatives complement our plans for larger-scale, mechanised production activities on mineral concessions in our property portfolio.”
Some of these mineral concessions were announced by last month, including two definitive joint venture agreements for copper/cobalt concessions in the DRC, totalling more than 48 square kilometres, with active negotiations on several other properties.
The Canadian company has filed an application with the DRC’s Ministry of Mines for a copper/cobalt trading and export licence, which will allow it to establish regional buying depots, process minerals in-country and export these metal concentrates internationally.
Procurement from artisanal and small-scale mining (ASM) sources is supported by an engagement with BetterChain SL to implement a framework demonstrating secure and transparent origin of materials, and support accountability tracking along the entire supply chain from source to store, starting with cobalt.
The blockchain-based platform that integrates this framework is being developed through a joint venture between the company and DLT Labs Inc to ensure supply chain transparency and the ethical sourcing of minerals.
“We expect our licensing to be finalised in May 2018 and initial cobalt concentrate exports to start early in the third quarter,” said COBC CEO Peter Hooper. “In parallel with developing our blockchain traceability and reporting systems, the next steps are to set up depot infrastructure, organise the ASM workforce, and begin conducting metallurgical testing for our first process plant.”
More than 12% of global cobalt production originates from ASM operations in the DRC. COBC’s multi-pronged strategy - developing cobalt supply agreements, joint venture copper/cobalt mining, and blockchain certification - are progressing towards its ultimate goal of delivering to the market certified, ethically-sourced cobalt from the DRC.
Cobalt Blockchain has acquired a 100% interest in an existing metals trading business specialising in sourcing minerals from artisanal and small-scale mines in the DRC, in compliance with international procurement standards.
Leveraging its experience with existing supply chain due diligence initiatives, COBC is working with partners to develop a blockchain-based reporting platform to provide greater certainty of provenance and further assurance that all minerals procured are ethically-sourced.