Jervois Global Pivots Kokkola Refinery Expansion BFS to United States

Jervois Finland technical team and engineering and consulting company AFRY Finland Oy (“AFRY”) have designed a BFS flowsheet for an initial refinery capacity of 6,000 metric tonnes per annum of contained cobalt in sulphate, the physical form required for the battery industry, including electric vehicles (“EVs”).  

AFRY will continue to provide specialist refinery expertise and leadership from Finland, but with the BFS to be run out of AFRY USA LLC.  Jervois USA’s team in Salmon, Idaho, will also provide specialist support for the U.S. BFS across key areas such as environment and permitting, logistics, utilities and construction readiness.  Jervois Finland, a leading supplier of high quality cobalt products and with 50 years of experience in cobalt refining and advanced manufacturing at Kokkola, will continue to provide stewardship of the BFS.

The U.S. Inflation Reduction Act of 2022 (“IRA”) is a landmark piece of federal legislation designed to incentivize domestic energy production, promote clean energy and support a U.S. transition away from fossil fuels, including for transportation.  The legislation provides for more than US$390 billion to support U.S. climate and clean energy policies.  A key focus of the legislation is to increase domestic extraction and processing rates of key battery materials and critical minerals including cobalt.  

The IRA is designed to stimulate U.S. domestic cobalt refining and recycling activities.  Jervois’s future U.S. cobalt refinery is expected to benefit from, inter alia, a 10 percent operating cost credit for the duration of its operating life.  Despite initial steps by Europe through its recent 2023 European Union Critical Raw Materials Act and Net Zero Industry Act, this represents a material competitive advantage over facilities not located in the U.S..  In addition, Jervois is encouraged by discussions with the U.S. Department of Energy (“DOE”) regarding various loan and grant programmes that are expected to be available to support refinery construction.  

As previously advised, Jervois continues to work through the final documentary steps to formalise a U.S. Department of Defense (“DOD”) intention to award US$15 million under the Defense Production Act (“DPA”) Title III program.  This grant is expected to fully fund the U.S. cobalt refinery BFS, in addition to the proposed drilling programme at ICO.  Should Finland and/or the European Union provide meaningful financial support and incentives similar to that of the U.S. in future, the Kokkola expansion BFS can be reinitiated by Jervois Finland and AFRY.  Based on customer (automaker and/or OEM) engagement, Jervois has visibility on future cobalt demand requirements in the U.S. and Europe that is expected to be able to support construction and commissioning of both facilities.  

Negotiations with automakers in both the U.S. and Europe continue to advance, and Jervois expects to finalise initial long-term cobalt sulphate contracts from Jervois Finland existing production capacity in both jurisdictions during 2023.  Current Jervois Finland cobalt sulphate sales into the battery sector, primarily long standing relationships in Japan, are sold on either annual or short term contracts.  Jervois expects refinery expansions in either the U.S. or Europe will be funded by third parties, via a combination of government and or customer support.

About AFRY

AFRY is a Swedish-Finnish industry leader in engineering, design, and advisory services, with a global reach.  AFRY was founded in Sweden and consolidated its Finnish operating footprint and nickel / cobalt processing expertise, via merging with Pöyry PLC in 2019.  

On behalf of Jervois Global Limited

Bryce Crocker, Chief Executive Officer

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Forward-Looking Statements

This news release may contain certain “Forward-Looking Statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. When used in this news release, the words “anticipate”, “believe”, “estimate”, “expect”, “target, “plan”, “forecast”, “may”, “schedule”, “expected” and other similar words or expressions identify forward-looking statements or information. These forward-looking statements or information may relate to the BFS to be undertaken in relation to a cobalt refinery to be located in the United States, the future capacity of the cobalt refinery, the funding sources for the BFS, the funding sources for the construction of a cobalt refinery in the United States and certain other factors or information. Such statements represent Jervois’ current views with respect to future events and are necessarily based upon a number of assumptions and estimates that, while considered reasonable by Jervois, are inherently subject to significant business, economic, competitive, political and social risks, contingencies and uncertainties. Many factors, both known and unknown, could cause results, performance or achievements to be materially different from the results, performance or achievements that are or may be expressed or implied by such forward-looking statements. Jervois does not intend, and does not assume any obligation, to update these forward-looking statements or information to reflect changes in assumptions or changes in circumstances or any other events affections such statements and information other than as required by applicable laws, rules and regulations.

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