Cobalt as a key element in the cathodes for lithium ion batteries faces a looming supply "cliff. Projected expansion in the demand to feed the EV and broader lithium-ion battery market faces an insufficient supply to meet that demand from known terrestrial cobalt deposits and planned cobalt (as a by-product) production expansion as part of laterite processing operations in SE Asia primarily focused on nickel recovery. But a relatively "new" and unprecedented scale cobalt resource is available and technologically accessible in the form of polymetallic nodules (a.k.a. manganese nodules), which lie on the surface of the deep seabed within the Exclusive Economic Zone (EEZ) of the Cook Islands, a sovereign nation in the South Pacific that encourages and invites seabed exploration. Ocean Minerals has completed a maiden inferred resource estimate (NI 43-101/JORC) for a project area within the Cook Islands EEZ, for which we have exclusive rights to apply for exploration and mining licenses. Within this project area there exists over 1 million tonnes of contained cobalt (as well as 470,000 tonnes of nickel, 260,000 tonnes of copper, and over 31,000,000 tonnes of manganese) in the nodule field. Additional areas within the Cook Islands EEZ are known to contain a high density of nodules and are accessible for future exploration. In addition to this nodule resource area, Ocean Minerals also holds similar exclusive rights over areas within the Cook Islands EEZ containing sediments with high grades of critical rare earth elements and scandium. While seen by most as a "new" source for cobalt, the idea of seabed mining is not new, nor does it rely upon unproven technologies. Shallow water mining has been conducted for decades for aggregates, gold, and diamonds. Deep water mining technology was developed and successfully proven in the 1970s within the Clarion Clipperton Zone of the Pacific mid-region (between Hawaii and the west coast of the US). Offshore oil and gas operations and deep ocean research have advanced to the point where deep seabed minerals mining has been significantly de-risked and is now ready for development. OML believes that the only potential solution for a looming cobalt deficit to feed the EV and battery market is to take to the seas and responsibly mine the deep seabed where resources can be recovered with minimal and observable environmental impacts, without the need for tremendous infrastructure build-up or risk of social conflict — and within a timeframe consistent with the projected demand increase. By doing so, cobalt can be supplied in sufficient quantities and at a reasonable cost to support the goals of the automotive industries and global economies committed to advancing EVs and phasing out internal combustion engines and driving greater electrification.
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