Key Highlights

  • The updated scoping study estimates a pre-tax NPV at 10% of approximately A$317 million and a pre-tax IRR of approximately 47% on a 100% project basis.
  • Initial Capital is estimated at A$75 million, with total development and sustaining capital of A$197 million including later stages.
  • Average annual production is estimated at 4,000 tonnes of copper cathode, 13,000 tonnes of contained zinc and 130,000 ounces of contained silver over about 11 years.
  • Cobalt Blue holds a 51% interest and has the option to lift it to 75% by spending a further A$1.5 million on the tenements by 30 June 2028.

Cobalt Blue Holdings Limited (ASX:COB) has released an updated scoping study for its Halls Creek Project in Western Australia, dated 10 November 2026. The study revises a June 2025 assessment and includes silver recovery for the first time, with copper, zinc and silver to be processed through a single plant at Onedin. The results point to a staged development in which Cash Flow from the first stage would help fund the second. The company describes the work as preliminary, with an estimated accuracy of plus or minus 35 per cent, meaning the figures are not yet a basis for ore reserves.

Staged development and processing route

The plan involves open-cut Mining at the Onedin deposit for about five years, followed by underground mining at Sandiego. Sandiego feed would be trucked along the Great Northern Highway to Onedin, where ore from each deposit would be stacked on separate heap leach pads. Pregnant solution from both heaps would be treated at a common plant at Onedin, which would recover silver first, followed by copper cathode and zinc oxide.

The updated design replaces the previously proposed Sandiego flotation concentrator with a shared heap leach pathway. Cobalt Blue says this changes the product mix from concentrates to saleable metals, which reduces transport volumes for Sandiego feed. The study targets stacking of about 55,000 tonnes a month for each operation, with an initial construction year followed by approximately 11 years of production.

Economic outputs and sensitivity

On a 100% project basis, the study reports a pre-tax NPV at 10% of A$317 million and a post-tax NPV at 8% of A$239 million. The post-tax IRR is estimated at 38%, with payback of approximately three years from first production. Life-of-mine sales Revenue is estimated at A$1.44 billion, operating costs at A$515 million and pre-tax free cash flow at A$681 million. Copper accounts for 56% of life-of-mine revenue, zinc for 37% and silver for 7%.

The price deck assumes US$13,007 a tonne for copper, US$3,086 a tonne for zinc and US$50 an ounce for silver, at an Exchange Rate of 0.70 US dollars per Australian dollar. Sensitivity tables show the pre-tax NPV falling to A$189 million at a copper price of US$12,000 a tonne and a zinc price of US$2,000 a tonne. At an exchange rate of 0.80, the estimate drops to A$224 million, while at 0.60 it rises to A$442 million. The figures are model outputs under the study's assumptions rather than forecasts of realised value.

Funding, ownership and approvals

Initial capital of A$75 million is required on a 100% project basis, with A$116 million of subsequent development capital to be funded from operating cash flow. Cobalt Blue intends to fund its share through Equity or a mix of equity and debt, and the company acknowledges there is no certainty that funding will be available on acceptable terms. It also notes that funding could be dilutive to existing shareholders, and that it may pursue a partial sale of its interest, which could reduce its proportionate share.

The project is held under a joint venture with Koongie Park Pty Ltd, a Wholly Owned Subsidiary of AuKing Mining Limited. Native title applies across the Koongie-Elvire determination area, and no native title agreement is in place for the mining leases, which pre-date the determination. Environmental baseline studies have not yet been completed, and Aboriginal heritage survey coverage is limited. The next stage is a preliminary feasibility study targeting completion in the first half of 2028.

Risks and uncertainties

The production target draws on Indicated resources for about 91% of scheduled feed and Inferred resources for about 9%. Recovery assumptions include 82.5% for copper at Onedin and 65% at Sandiego, and 30% for silver at both deposits. Sandiego was only represented in combined test blends, which the company says limited coverage of that deposit. Further metallurgical testwork, heap design and zinc oxide product quality remain open, and the mine plan, waste management and power system are all subject to further engineering.

Market exposure is significant, as the Economics depend on copper, zinc and silver prices and on the exchange rate. Several technical and approval steps remain before any development decision, and the mining leases come up for renewal in 2031.

Final Word

The revised Halls Creek study places three saleable metals in a single processing pathway, with reported economics that remain sensitive to Commodity prices and the Australian dollar. The coming preliminary feasibility work will test metallurgy, approvals and funding terms, and the results of those workstreams will show whether the figures move closer to the study's assumptions.