- 01Cobalt Blue notes a breakdown in the historical correlation between the underlying cobalt price and its share price, highlighting this disconnect in recent company updates.
- 02The company points to early signs of a structural recovery in the global cobalt market, driven by sustained energy transition demand and supply management in the Democratic Republic of the Congo (DRC).
- 03Preparations are actively underway for an updated Preliminary Feasibility Study (PFS) for the Broken Hill Cobalt Project (BHCP), with a targeted completion in Q4 2026.
- 04The BHCP remains one of the largest undeveloped primary cobalt resources outside of Africa, hosting an estimated 87,000 tonnes of contained cobalt.
Cobalt Blue (ASX: COB) is navigating a shifting macro environment as it advances its flagship critical minerals asset.
In recent communications, the company highlighted a divergence between its current market valuation and the underlying commodity it intends to produce.
Historically, the company's valuation has tracked closely with global cobalt markets.
However, management recently noted:
“There used to be a strong correlation between the cobalt price and the COB share price, but that relationship has broken down — opening the door for a potential re-rating”
This observation comes alongside a broader recovery in the cobalt market. After an extended period of price weakness, the market has begun regaining ground throughout 2025 and 2026.
The Broken Hill Cobalt Project (BHCP)
Against this macroeconomic backdrop, Cobalt Blue is advancing the BHCP, a tier-1 critical minerals asset situated in Broken Hill, New South Wales.
The project currently hosts a JORC Mineral Resource of 127 million tonnes at 867 ppm cobalt equivalent.
However, the company is currently updating its PFS and is expected to publish results to market in Q4 this year.
The strategic positioning of the BHCP aligns with a growing push from Western society to secure ethical, non-Chinese critical mineral supply chains.
PFS Progression and Optimisation
Over the past quarter, Cobalt Blue has continued preparations for an updated Preliminary Feasibility Study (PFS), targeting completion in Q4 2026.
The upcoming PFS is focused on defining project scale, evaluating capital intensity, and outlining staged development pathways.
The company's stated goal is to define a robust "starter-case" scenario that facilitates initial production while preserving the long-term optionality to scale operations as the market demands.
Recent progress feeding into the Q4 2026 PFS includes:
- Strategic Mine Planning: Optimising project value and waste storage to ensure operational efficiency.
- Metallurgical Advancements: Ongoing test work designed to unlock additional value and improve recoveries from the deposit's oxide and transitional material.
- Permitting: Advancing crucial environmental approvals, including the submission of a revised Scoping Report to the NSW Government.
Upcoming Milestones
- Q4 2026 PFS Delivery: The formal release of the updated Preliminary Feasibility Study will provide updated economic metrics, including capital expenditure and operating costs, based on the optimised, staged development pathway.
- Commercial Developments: Any updates regarding government grants, offtake discussions, or strategic partnerships as the company seeks to commercialise its non-African cobalt source.
Bottom Line
Cobalt Blue is actively progressing one of the largest primary cobalt resources globally.
With the BHCP PFS slated for Q4 2026, the company is focusing on a capital-efficient, staged pathway to production.
Simultaneously, management has drawn attention to the current breakdown in correlation between the COB share price and the recovering cobalt market, suggesting that a return to historical norms could significantly impact the company's market positioning as global supply chains continue to tighten.
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