We did not have to wait long to hear a great deal of news coming out of Canada and the hints dropped by giant miner Vale. The Newfoundland Voisey’s Bay nickel mine owned by Brazilian company Vale will be investing $2 billion to convert the mine from an open pit to underground mine by 2021. This investment extends the life of the nickel/cobalt mine to 2035. Cobalt is a by-product of nickel and copper extraction and will be a major consideration in the funding and extension of this mine. Wheaton Precious Metals and Cobalt 27 will acquire a fixed percentage of cobalt production from Vale's Voisey's Bay mine for US$690 million for purchase of finished cobalt equal to 75% of Voisey's Bay cobalt production commencing January 1, 2021.
"We see numerous similarities between cobalt and silver, as both are primarily produced as by-products and both are integral to sustainable clean energy and electronics" said Randy Smallwood, Wheaton's President and Chief Executive Officer.
This is great news for the mining sector, and for the province which could use the employment and revenue. The mining of cobalt is primarily done in the Congo, so having such a major deal done here in Canada is welcomed and shows not only the interest in coming to safe investment jurisdictions but recognition of markets to the demand for materials needed in the electric vehicle market.