ERG and Thara Announce MoU for Pioneering Cobalt Refinery in Saudi Arabia

Strategic Partnership to Bolster Electric Vehicle Battery Supply Chain

by Oluwatosin Racheal Alabi

Eurasian Resources Group (ERG) is set to make a significant leap in the electric vehicle battery market with the development of a new cobalt sulphate refinery. The project, which aims to process cobalt hydroxide into cobalt sulphates, comes as a strategic move to strengthen ERG’s position as a key supplier in the battery chemicals sector, particularly for electric vehicles.

ERG has chosen the Kingdom of Saudi Arabia as the potential host for this ambitious refinery and is partnering with Thara Future Investment Company (Thara) to investigate and pursue this investment. Thara, a platform established by leading Saudi investors, is focused on capitalizing on Vision 2030 opportunities, especially in sectors where the Kingdom has a distinct advantage. This includes leveraging the Kingdom’s considerable mineral wealth and value chains in areas such as chemicals, waste management, and future materials.

Benedikt Sobotka, CEO of Eurasian Resources Group, highlighted the increasing market penetration of electric vehicles, which is expected to quadruple the demand for cobalt-bearing batteries by 2030. He emphasized ERG’s commitment to ensuring sustainable and traceable cobalt sourcing for global battery supply chains. The collaboration with Thara is set to accelerate the development of the cobalt sulphate refinery in Saudi Arabia, marking a significant step in ERG’s expansion and contribution to the sustainable battery materials sector.

Hisham Attar, Managing Partner of Thara, expressed enthusiasm about the partnership, viewing it as a venture that embodies their commitment to innovation and sustainable growth. This project is in line with Thara’s vision and purpose, unlocking new opportunities in the Kingdom.

The refinery will source its cobalt hydroxide from ERG’s Metalkol facility in the Democratic Republic of the Congo (DRC), a site known for its environmental restoration operations and the production of high-quality copper cathode and cobalt in hydroxide. Sobotka pointed out that ERG holds vast cobalt resources in the DRC and is one of the largest global suppliers of cobalt hydroxide. With the supply underpinned by its upstream operations, the proposed cobalt refinery project is considerably de-risked.

Operations at Metalkol are conducted following the ERG Clean Cobalt & Copper Framework, adhering to responsible and sustainable practices. This commitment to ethical and eco-friendly operations is a cornerstone of ERG’s business philosophy, ensuring that their expansion into refinery operations will continue to align with these principles.

This partnership between ERG and Thara represents a significant development in the battery metals industry. It not only enhances ERG’s position as a key player in the supply chain for electric vehicle batteries but also contributes to Saudi Arabia’s Vision 2030, diversifying its economy and expanding into new technological and industrial sectors. The establishment of the cobalt sulphate refinery in Saudi Arabia is a strategic move that aligns with the Kingdom’s aim to become a hub for future materials and green technologies.

The collaboration also underscores the growing importance of cobalt in the global economy, particularly with the surge in demand for electric vehicles and renewable energy solutions. Cobalt, a critical component in lithium-ion batteries, is essential for the transition to cleaner energy sources. By investing in the development of a cobalt refinery, ERG and Thara are positioning themselves at the forefront of this emerging market, contributing to the global shift towards sustainable energy.

Moreover, the refinery will bolster Saudi Arabia’s position in the global mining and minerals sector. The Kingdom has been actively seeking to develop its mining sector as part of its economic diversification efforts. This project is a testament to Saudi Arabia’s potential as a key player in the global supply chain for battery metals and its commitment to sustainable development.

The decision to source cobalt hydroxide from ERG’s environmentally responsible Metalkol facility further highlights the project’s commitment to sustainable mining practices. This approach is crucial, given the often contentious nature of cobalt mining, particularly concerning environmental and ethical concerns.

In conclusion, the MoU between ERG and Thara for the development of a cobalt refinery in Saudi Arabia is a strategic initiative that promises to reshape the landscape of the battery metals market. It not only strengthens ERG’s position as a key supplier of cobalt but also aligns with Saudi Arabia’s vision to diversify its economy and invest in future-oriented industries. As the world moves towards a more sustainable future, partnerships like these will be crucial in driving innovation and ensuring the responsible sourcing and processing of critical minerals like cobalt.

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