Electra Battery Materials (NASDAQ: ELBM; TSX-V: ELBM) said yesterday that the commissioning of its cobalt refinery has been delayed due to problems with critical equipment.
The Ontario-based company also warned of inflation in its Q2.
“We made considerable progress on our battery materials refinery project in Q2, completing 80 per cent of testing of existing brownfield equipment for recommissioning, 80 per cent of all procurement, and 85 per cent of detailed engineering,” said Trent Mell, CEO of Electra Battery Materials. “But consistent with the realities facing companies who are constructing projects around the world today, we experienced the dual impacts of inflationary price pressures and supply chain disruptions firsthand during the second quarter.
“Most notably, delivery of critical equipment for our refinery project was impacted by quality control issues experienced by a major supplier that will result in completing the commissioning project in the spring of 2023. Equally significant, rising prices for input costs, such as steel, copper, piping, and contract labour rates, that were unanticipated when we first developed our capital budget, will increase project capital costs from our previous estimate of US$67 million to US$76 to $80 million.
Mell said that the battery recycling demonstration plant is on schedule.
The company's cash position is $41.8 million as at June 30, 2022, down from $51.9 million as at March 31, 2022. Total incurred costs for the refinery construction project at quarter end were $30.1 million.
Electra is commissioning a cobalt sulfate refinery north of Toronto. It is also advancing its Iron Creek project, a cobalt-copper exploration-stage project in the Idaho Cobalt Belt.
