Chilean Cobalt gets US$317M funding from EXIM Bank

The United States Export-Import Bank is funding Philadelphia-based critical minerals explorer Chilean Cobalt (US-OTC: COBA) with US$317.4 million in debt to restart the La Cobaltera cobalt-copper mine in northern Chile. 

This financing is part of EXIM Bank’s China and Transformational Export Program, an initiative designed to help American companies facing competition from China in sectors including renewable energy, the company said on Monday. The loan has a tenor of up to 15 years, according to the bank’s letter of interest. 

The funding may cover a definitive feasibility study for La Cobaltera. It’s the largest production area in the San Juan district, home to numerous past-producing mines. Chilean Cobalt Corp., which calls itself C3, owns 26 sq. km of mining concessions there. 

“With the district-scale potential that this project holds, we are focused on restarting and expanding these past-producing mines while exploring for additional resources,” C3 chairman Duncan Blount said. La Cobaltera is one of the “only few primary cobalt deposits known globally,” he said. 

Shares in Chilean Cobalt closed 22% lower on Monday at US$1 apiece, valuing the company at US$43.5 million. They’vre traded in a 52-week range of US25¢ to US$1.29. 

Mid-1800s

Mining in the region dates from the mid-1800s until 1944. Cobalt grades between 1% and over 15% were mined from open pits and underground during that era. The government recognizes it as one of the country’s premier cobalt exploration targets. 

The La Cobaltera project includes cobalt-copper oxide and sulphide resources with evidence of gold at depth across several known exploration and development targets district-wide.

Development will take two stages. The first will focus on near-term production potential from the resources with little to no overburden, taking advantage of the district’s historical open pit development. Stage two will focus on the deeper sulphide mineralization, which contains copper and cobalt with evidence of gold.

The support from EXIM Bank would provide funding for most of the anticipated construction and development capital required for first stage one focused on the deposit’s cobalt-copper oxide zones, the company said.