This week saw Canadian cobalt developer Global Energy Metals (TSX-V:GEMC) announce that initial results for its environmentally friendly metal recovery process at its assets in Nevada have exceeded expectations.

As announced last week, the firm has signed a deal that will see cobalt, nickel, and copper-bearing mineralised material from its Lovelock and Treasure Box sites undergo a process called Re-2OX. Owned by Canada Cobalt Works, Re-2OX is a proprietary and environmentally green hydrometallurgical process that recovers cobalt, precious metals, and base metals without using a traditional smelter.  Canada Cobalt has said that the operation can create battery-grade cobalt sulphate, adding that nickel-manganese-cobalt battery-grade formulations are also in the pipeline.

Global Energy believes the deal will allow it to confirm efficient battery metal extraction at Lovelock and Treasure Box, and create a potential battery-grade test product.  This will form part of a broader exploration work program at the sites beginning this month that is expected to allow for the reinterpretation of historical data.  The company hopes this work will provide it with a better understanding of its ability to unlock the cobalt, nickel and copper potential of its Nevada acreage.

On Thursday, Global Energy said that – alongside Canada Cobalt – it has already begun on-site work related to Re-2OX at Lovelock and Treasure Box. The business said initial fieldwork is demonstrating the potential to identify high-grade cobalt, nickel, and copper mineralisation over broader areas than original believed at both sites. More details on its planned reconnaissance programme will be provided shortly. Elsewhere, the company said it has terminated the 7.5pc financing announced as part of the Canada Cobalt deal due to Policy 5.3 for Tier-2 Venture Issuers under Section 7.1.

Under the terms of this month’s deal, Canada Cobalt will supervise the reconnaissance programme, protecting intellectual property as results flow to Global Energy.  The business will also be paid a $200,000 upfront first-stage fee for the use of Re-2OX, exclusive of sampling and lab costs that will be funded by Global Energy to a maximum of $100,000.  The two organisations will also look at broadening their relationship in the future.

Lovelock and Treasure Box are based around 150km east of Tesla’s major battery factory in Sparks. Lovelock covers around 1,400 acres and is said to have produced 500ts of cobalt and nickel mineralisation between 1883 and 1890 when it was last in operation. Global Energy believes exploration work and modern drilling techniques could unlock a large amount of potential value at the site.

Treasure Box, meanwhile, is adjacent to Lovelock and hosts mine workings from limited copper production, which occurred until early into the 20th century. A historical diamond drill hole at the asset reportedly intersected 1.52pc copper over 85ft, with mineralisation beginning at the surface.

Earlier this month, Global Energy revealed that it had paid a bond that would allow it to begin its staged exploration programme in Nevada. This came just days after the business raised $813,500 in an oversubscribed placing at $0.05 a share to support the funding of the programme.

Global Energy focuses on offering security of supply of cobalt, which is a critical material in the rapidly growing rechargeable battery market. It is building a diversified global portfolio of assets in the sector, including project stakes, projects and other supply sources.

The business’s flagship asset is the Millennium Project in the world-renowned Mt. Isa region of Queensland, Australia. It executed the final agreements to take a 100pc interest in the project in November. Millennium is a multi-zone, near-surface cobalt-copper sulphide system with several kilometres of potential strike length. It is located near established mining, transport, and processing infrastructure and offers easy access to a very skilled workforce.

The growth-stage site contains a defined zone of cobalt-copper mineralisation. Here, a 2016 JORC Resource estimate identified 3.1MMts of inferred resources containing 0.14pc cobalt and 0.34pc copper with gold credits. Global Energy is now looking at ways to increase the size of its deposit. Results from a first phase exploration campaign at two zones called Millennium North and Millennium South exceeded grade and thickness expectations. The firm will now carry out a second phase of drilling to examine both areas further.

Alongside Millennium, Global Energy has acquired two further discovery sites called Mt. Dorothy and Cobalt Ridge. These are collectively known as the ‘Mt. Isa projects’. The areas expand Global Energy’s Australian land position by nearly twenty times but have yet to be exploited. Exploration to date has returned high-grade cobalt intercepts at both, allowing Global Energy to line up numerous targets for further investigation and test work to define a resource.

Finally, the business currently owns 70pc of the Werner Lake cobalt mine in Ontario Canada. Its joint venture partner Marquee Resources is enjoying much success in its ongoing exploration campaign at the asset.

Author: Daniel Flynn

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