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A major Idaho cobalt mine was about to begin production. Its owner just changed course

On a mountain in the Salmon-Challis National Forest, Jervois has built a water treatment plant, buildings for milling and a mine camp for workers. The company has now halted production.  (Ian Max Stevenson/Idaho Statesman)
On a mountain in the Salmon-Challis National Forest, Jervois has built a water treatment plant, buildings for milling and a mine camp for workers. The company has now halted production. (Ian Max Stevenson/Idaho Statesman)
By Ian Max Stevenson Idaho Statesman

A highly anticipated cobalt mine in the mountains near Salmon has been put on hold just as it was about to go into production. The mine would have been the only primary cobalt mine in the country.

Jervois Global Limited, of Melbourne, Australia, announced Tuesday that it would halt construction at its mine because of falling cobalt prices and the effects of inflation on construction costs.

The company’s decision came just prior to the start of the mine’s production of cobalt, and months after Idaho Gov. Brad Little, the Australian ambassador to the U.S. and other dignitaries visited the site to herald its arrival in the Salmon River Mountains.

“We’re disappointed, of course,” Tammy Stringham, executive director of the Lemhi County Economic Development Association, told the Idaho Statesman by phone. “This cobalt project has been in the works for close to 20 years. It has had many starts and stops over the years.”

A series of companies have owned this mine’s rights, and other companies are exploring deposits in the area. Jervois acquired eCobalt Solutions, a Canadian company that had owned the mining rights, in 2019. Jervois has invested more than $100 million in the mine since purchasing it.

The company had predicted that the mine would employ up to 180 people. Last fall, there were about 240 people, including building contractors, on site as prep work was underway to launch the mine.

In an announcement on Twitter, Jervois said it expects to resume efforts “over the medium term,” once the price of cobalt rises. Cobalt prices have fallen by more than half since early last year.

The Idaho mine had been welcomed by U.S. officials, who have ramped up efforts to secure domestic supplies of what are known as critical minerals, and which are used in batteries for electric vehicles and cellphones. The minerals are in high demand as the U.S. economy shifts away from fossil fuels.

Though not a large mine by global standards, the Jervois operation near Salmon had been expected to supply about 10% of current U.S. cobalt demand, which would power about 400,000 new electric vehicles per year.

China, which many leaders in Washington view as the greatest threat to national security, controls most of the world’s production and refining of cobalt. There are no cobalt refineries in the U.S., and Jervois had planned to ship the Idaho cobalt to a refinery in Brazil.

Idaho’s congressional leaders saw the Jervois mine as a step toward gaining independence from China, and opening up a supply of the mineral for the U.S. and its allies.

“China’s the issue in national security and in foreign relations for the rest of the century,” U.S. Sen. Jim Risch, a Republican, previously told the Statesman in an interview. “They are a near-term competitor for us now, economically, militarily and culturally … and they have a lock on a lot of the critical minerals that are needed around the world. The concern always is that you have to treat them with kid gloves when you’re dealing with them, because they can just cut you off.”

The Statesman reached out to both Risch’s and Little’s offices for comment Thursday but did not hear back immediately.

In announcing its suspension, Jervois noted that the company applied for government grants to “accelerate” drilling in the area and to study the potential construction of a refinery on U.S. soil. The company said the further study “can proceed as planned despite (the mine’s) suspension.”

Mining near Salmon has a fraught environmental history. The Blackbird Mine, a cobalt mine that operated in the 20th century, poisoned fish and vegetation in a nearby creek. As Jervois prepared to begin production, a former U.S. Forest Service employee raised concerns about whether the government was requiring the company to provide enough funding to clean up the ecological damage the mine could cause.

In Salmon, residents are familiar with the ups and downs of mineral economies, Stringham said. She said mine officials told her they expect to keep fewer than 30 people employed at the site for the time being, and she hoped they would try to keep locals employed.

“We all had high hopes for this one, it seemed like it was going to go; it was so close,” she said. “This community’s pretty resilient. They’ve been through the boom and bust cycles before. This community always seems to find a way to survive.”

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