YAOUNDE, July 13 -- Canada-listed Geovic Mining (GMC.TO: Quote) may start work on its Nkamouna cobalt, nickel and manganese project in Cameroon as early as this year, the firm said on Monday, bringing forward a project that had been delayed until 2012.
But even if digging does begin this year full commercial production may not start until 2013-14 and mining itself could be pushed back to April 2011, depending on the outcome of a feasibility study currently underway, interim general manager Conrad Houser told Reuters.
The firm says it sits on a deposit large and rich enough to make it the world's largest miner of cobalt.
It also wants to build a 6,000 tonnes per month refinery on site in order to process ore into higher value products.
"Geovic has recovered from last year's global financial crisis," Houser said.
"A major innovation was the decision by the board on July 1 to construct a refinery at the project site to upgrade the final quality of the cobalt, nickel and manganese that will be extracted," he said. Building a refinery that could produce cobalt carbonate and oxide, nickel carbonate and manganese products would push the overall project cost to $500 million, Houser said.
"Most of the product will be pre-sold with some reserved for spot markets," Houser said, declining to name any offtake partners.
Last year the firm cut its cost forecast to $250-300 million from an original $400 million and said production would be delayed until 2012 from an initial target of 2010, blaming weak metals prices and the difficulty of raising funds.
Cobalt, which began trading on the London Metal Exchange futures market for the first time earlier this year, CBD3=LX last closed at $37,500 per tonne, down from almost $50,000 in April.
Cameroon has the potential to become a producer of iron ore, aluminium and bauxite as well as cobalt, but several mining projects have been delayed, and production is still some years in the future.