Cobalt Blue Holdings Ltd (ASX:COB, OTC:CBBHF) has discharged the final instalment on a long-standing promissory note issued to American Rare Earths Ltd (ASX:ARR, OTCQB:ARRNF), a move that fully clears the Broken Hill Cobalt Project of encumbrances.
The $1 million payment, together with accrued interest of $42,246, marks the conclusion of a financial arrangement dating back to January 2020, when Cobalt Blue acquired ARR’s interest in the Broken Hill project. The deal secured Cobalt Blue 100% ownership and legal title over the cobalt asset in far western New South Wales.
Cobalt Blue CEO Dr Andrew Tong said the repayment closes an important chapter in the company’s development path.
“We thank ARR for their support since 2017 on the Broken Hill Cobalt Project,” he said. “We look forward to advancing the project as the cobalt market continues to adapt to the improving market conditions.”
Broken Hill Cobalt Project unencumbered
With the note fully repaid, the Broken Hill Cobalt Project (BHCP) is now unencumbered, strengthening Cobalt Blue’s tenure position. The project — 25 kilometres southwest of Broken Hill — covers about 39 square kilometres and is considered one of the largest undeveloped cobalt resources outside Africa.
BHCP hosts a globally significant JORC resource of 126.5 million tonnes at 867 parts per million (ppm) cobalt equivalent, containing 87,000 tonnes of cobalt, along with sulphur and nickel by-products. Deposits at Pyrite Hill, Big Hill and Railway extend over 5 kilometres of strike, with mineralisation tied to cobaltiferous pyrite.
Read more: Cobalt Blue advances refinery and project milestones as Broken Hill hub delivers key results
Cobalt Blue has developed a proprietary flowsheet to unlock cobalt from pyrite at scale.
BHCP process flowsheet. (Source: Cobalt Blue)
A demonstration plant run in 2023 produced mixed hydroxide precipitate and high-purity cobalt and nickel sulphates, confirming the processing technology’s commercial potential.
Demonstration Plant – MHP (left) and cobalt sulphate (right). (Source: Cobalt Blue)
The company also highlighted a shifting market backdrop, with the Democratic Republic of Congo preparing to lift its seven-month cobalt export suspension later this month, replacing it with a quota system. Since the announcement, cobalt prices have risen 15% to their highest since early 2023.
Cobalt standard grade metal price. (Source: Fastmarkets)
ARR to channel funds into Halleck Creek
For American Rare Earths, receipt of the final payment provides additional capital to advance its flagship Halleck Creek Project in Wyoming.
ARR said the funds would be applied to its strategic priorities, including development of the Cowboy State Mine, a rare earths deposit positioned to underpin US critical mineral independence. The project benefits from open-pit potential, favourable permitting conditions and planned onsite processing to reduce reliance on imports from China.
Read more: American Rare Earths hits important milestone at Cowboy State Mine
ARR continues to collaborate with US government-supported research programs on environmentally responsible extraction and processing technologies.