Aeon Metals says their Walford Creek prospect is up to the challenge of making Australia, Queensland and the North West a hub for cobalt production.
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On Wednesday Mines Minister Dr Antony Lynham was in Mount Isa to talk up the prospects of the mineral used in the production of mobile phones, wind turbine generators and electric cars.
With much of the world's supply tied up in wartorn parts of Africa, Aoen Metals operations manager Dan Johnson said their exploration at Walford Creek, 350km north west of Mount Isa, could lead to Australia becoming an exporter.
"At Walford Creek Project we're fortunate we have the highest grade cobalt sulphide deposit in Australia," Mr Johnson said. "Importantly it is with copper, cobalt is rarely mined on its own as a commodity as it is usually seen as a by-product."
Mr Johnson said this was because of the wild swings of the cobalt price.
"Last year it was $US90,000 a tonne, it's currently at $US28,000 a tonne," he said.
"If you have a cobalt only project you have a very big issue to understand what your forward commodity price is going to be."
Mr Johnson said Walford Creek was a good opportunity as it was under-explored.
"It has the potential to be a world class project," he said.
"As a copper-cobalt project it is probably unlike anything else in Australia. 60% of the world's cobalt comes from the Congo and Zambia and it is exciting we have something similar here."
Aeon Metals are hoping on a 15 year mine life beginning in the early 2020s.
"We are moving to pre-feasibility stage at the moment," Mr Johnson said.
"There'a lot of work to do in that that, understanding the ore body and how we process it and also how we deal with the environmental side and making sure taking everyone along for the ride."
Mines Minister Antony Lynham said Walford Creek would enable the world have a more secure and ethically sourced supply of cobalt.
"With deposits like this we are lining up Australia to become one of world's biggest sources of cobalt and it will be in demand in the new economy," Dr Lynham said.
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