Mayor Tom Kennedy said he was encouraged by recent discussions with Cobalt Blue, despite the company planning a review to investigate a potential downsize of its local mining project.
Council met with the Company on Thursday after it announced it would conduct a strategic review of its mining venture, which aims to produce cobalt for a growing world-wide battery market.
Mayor Kennedy said he could understand Cobalt’s Blue’s revised approach to the project given the current impact of inflation on projects of all sizes.
“We can absolutely sympathise with the challenges Cobalt Blue is facing, we are constantly having to modify and rescale our own projects just as a Council,” he said.
“The reality is that materials and labour are tremendously expensive at the moment, and Cobalt Blue has the added burden of a weak Cobalt price to contend with.”
However Mayor Kennedy said the business model likely to be adopted by Cobalt Blue augured well for the future of the project.
“It was explained to us that their plan is to investigate running a more compact operation to generate some cash flow, which will provide them with base infrastructure from which they can quickly expand when Cobalt prices recover,” he said.
“Broken Hill people will understand that approach, they know the mining game as well as anyone and that it’s a boom and bust cycle.
“I find it encouraging that Cobalt Blue are pushing ahead and getting to a state of readiness for when the market recovers – they could have easily just shelved the project and walked away.
“I want to thank the Company for their commitment to the project and Broken Hill, and also for their honesty and openness in outlining the situation with Council.”
Cobalt Blue’s announcement on its future operations can be found here:
Those seeking further information are invited to register a public webinar to be held tomorrow at 10am:
