Cobalt Blue Holdings Ltd (ASX:COB, OTC:CBBHF, FRA:COH) says progress towards a final investment decision (FID) on its proposed Kwinana Cobalt Refinery (KCR) remained the central focus of a busy December 2025 quarter, as the company refreshed project economics, advanced offtake and financing discussions and strengthened its funding position with an oversubscribed capital raise.
Cobalt Blue told investors it completed a re-evaluation of KCR project parameters in response to structural changes in global cobalt markets during 2025. The updated approach narrows feedstock assumptions to cobalt hydroxide, expands the product mix to include cobalt metal alongside cobalt sulphate, and refreshes underlying economic assumptions ahead of FID.
As outlined in a November project update, these changes materially improved the base case (Stage 1) financial metrics on a 100% ownership basis. Post-tax NPV8 increased from A$90 million to A$155 million, post-tax IRR rose from 23% to 32%, and total free cashflow lifted from A$367 million to A$503 million.
Kwinana Cobalt Refinery advances toward FID
During the quarter, Cobalt Blue and partner Iwatani Australia continued workstreams required to progress the refinery towards FID, including offtake, feedstock, financing and engineering activities.
The company reported receiving multiple non-binding letters of intent from globally significant buyers in the US, Japan and France. Together with Iwatani’s 30% offtake entitlement, the LOIs cover around 70% of KCR’s initial 3,000 tonnes-per-annum production capacity. Cobalt Blue said it continues to engage with these parties with the aim of converting LOIs into binding agreements, a key condition precedent to FID.
Feedstock discussions also progressed, supported by a previously announced contract with Glencore International AG, which will supply up to 50% of KCR’s cobalt hydroxide requirements for the first three years of commercial operations. Engineering work required for construction and operating permit submissions advanced during the quarter, with activity set to ramp up through the March 2026 quarter.
Cobalt Blue also commenced the process to seek recognition of KCR as a strategic project under the EU Critical Raw Materials Act, a move the company said could open additional financing pathways within Europe.
Technology centre builds optionality
At the Broken Hill Technology Centre, the company continued test work aimed at validating battery black mass from recycled lithium-ion batteries as a potential long-term feedstock for KCR. The work follows successful bench-scale testing and is targeting a continuous circuit capable of producing cobalt metal, nickel hydroxide and manganese sulphate.
Cobalt Blue said success in this area could enhance supply chain flexibility, strengthen the refinery’s sustainability credentials and potentially create modest near-term revenue opportunities through contract test work. During the quarter, the company secured a A$100,000 test work contract with a tier-one international copper producer.
The company also began supplying cobalt sulphate monohydrate to CSIRO’s Cathode Precursor Production Pilot Plant, supporting Australia’s domestic battery materials capability.
Funding and corporate update
Cobalt Blue closed the quarter with an oversubscribed A$5.3 million placement, providing what management described as a strong funding platform to execute planned activities through 2026.
CEO Dr Andrew Tong said the quarter rounded out “a solid year of sustained progress” for the company.
“While our primary focus remains on completing the final steps required to progress the Kwinana Cobalt Refinery toward construction, we are equally encouraged by the range of complementary initiatives advanced during the period,” Tong said.
The company also confirmed it had fully repaid a promissory note linked to its 100% ownership of the Broken Hill Cobalt Project and completed a board leadership transition during the quarter.