Download eCobalt Advances ICP as Cobalt Prices Increase

Derek Macpherson | VP Mining Analysis
[email protected]
Sunneva Bernhardsdottir | Associate, Mining Analysis
[email protected]
Victoria Ellis Hayes | Associate
[email protected]
eCobalt Solutions Inc. – TSX:ECS
March 6, 2017
eCobalt Advances ICP as Cobalt Prices Increase
eCobalt Solutions’ (TSX:ECS) provided a corporate and operations update on its Idaho Cobalt Project
(ICP) near Salmon, Idaho. The update suggests progress has been made in advancing the project and
that the feasibility study is on track to be completed in Q2. A third-party market study established that
cobalt sulfate samples produced from ICP meets the standards for the most recent NMC and NCA
battery technologies. We view this positively as it should allow the company to complete an off-take
agreement. In addition, the company announced it has completed the ~800m metallurgical drill program
which commenced in Q3 2016. Cobalt sulfate crystal samples produced from the drill core are expected
to be made available to potential off-take clients for due diligence purposes. Earlier in Q1, eCobalt
closed a C$17.25 million financing to fund the project to a construction decision. With the project
progressing, we believe eCobalt is likely in a good position to take advantage of the increasing cobalt
prices. Cobalt prices have increased by ~55% since the beginning of 2017.
Company Information: eCobalt Solutions Inc (TSX:ECS)
eCobalt is a Canadian mineral exploration company focused on the development of its wholly owned cobalt-copper-gold Idaho Cobalt Project (ICP), which hosts 75M lb of
CoEq. The company hopes to begin initial production of battery grade cobalt salt in 2018 with annual output forecast to be 1,500 tonnes over a 12.5 year mine life. An updated
feasibility study is expected in Q2 2017 and we anticipate that the company is likely to complete an offtake agreement for a portion of its cobalt sulfate heptahydrate
production along with announcing the balance of project financing around the same time.
TSX.ECS - Stock Chart
Key Project
1,000,000
Project
900,000
$1.20
800,000
700,000
$1.00
600,000
$0.80
500,000
$0.60
400,000
300,000
$0.40
200,000
$0.20
Volume - Shares Traded
Share Price (C$)
$1.40
100,000
$0.00
0
Volume - Shares Traded
Price per Share (C$)
Sources: RCKS, Capital IQ, Thomson Reuters, Company Reports
ICP
(Idaho)
Stage
Current Resources (M&I+I)
Notes
PEA - 2015
74M lbs CoEq
(5.1Mt @ 0.63% CoEq)
Ann. prod: 3M lb at US$4.94/lb Co
Initial Capital: US$147M, LOM: 12.5 years
Financials
Price (C$/sh):
Basic S/O (M):
Fully Diluted S/O (M):
Market Cap (C$ M):
Cash (C$ M):
Debt (C$ M):
EV (C$ M):
After-tax NPV @ 8.5% (US$ M):
After-tax IRR:
Peer Comparison
$1.33
124.5
147.6
$165.6
$20.4
$0.0
$145.2
$113.5
24.1%
Company
TSX:ECS
TSXV:CSK
TSXV:CPO
CSE:FIN
TSX:FT
TSXV:KBG
TSXV:STM
Peer Average
P/NAV (C$)
0.62x
NA
NA
NA
NA
NA
NA
0.62x
EV/lb (C$)
$1.6
NA
NA
NA
$0.3
NA
NA
$0.9
Derek Macpherson | VP Mining Analysis
Sunneva Bernhardsdottir | Associate, Mining Analysis
Victoria Ellis Hayes | Associate
Red Cloud Klondike Strike Inc.
79 Wellington St. W. Suite 1630, PO Box 148
Toronto ON, M5K 1H1
[email protected]
www.redcloudks.com/rcks-talk
Priced as of prior trading day's market close, EST (unless otherwise noted).
All values in USD unless otherwise noted.
For Disclaimer and Applicable Disclosures, see the end of this report
eCobalt Advances ICP as Cobalt Prices Increase
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Company Specific Disclosure Details
Company Name
Ticker
Disclosures
eCobalt Solutions Inc. TSX:ECS 2
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2)
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4)
5)
6)
7)
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March 6, 2016
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