Automotive designer and entrepreneur Henrik Fisker refers to cobalt as the “blood diamonds” of lithium-ion battery production. Much of the world’s cobalt currently comes from mining operations in the Democratic Republic of Congo, where child labor and other serious problems continue.
For electric vehicle developers, cobalt presents a conundrum because the chemical is a crucial element of lithium-ion batteries and likely to be essential for next-generation battery technology as well. Fisker explained that cobalt serves as a stabilizer. “We’ll still need it even as we go to solid-state batteries,” he says.
This fall, the chairman and CEO of Fisker Inc. joined the board of directors for First Cobalt, a company that formed last year to explore, develop, and refine cobalt material in North America for sale back to the American electric vehicle market. Their goal: ethically sourced and sustainable cobalt.
Recently we caught up with Fisker and Trent Mell, president and CEO of First Cobalt, to learn more about their efforts.
Henrik, what are you working on now at Fisker Inc.?
Henrik Fisker: A lot of different things. In the public domain is the Fisker EMotion, our higher-end luxury electric vehicle, and the Fisker ORBIT smart shuttle. We’re looking at this autonomous shuttle driving set routes on closed areas in the beginning. We are also working on our solid-state battery technology. It’s about more energy density and getting the price down. They’re safer, and you can charge faster. The fourth is a more affordable high-volume range of electric vehicles.
How does cobalt factor into your company’s supply chain?
Fisker: Cobalt is an important part of pretty much all batteries. Scientists have tried to reduce the amount of cobalt, but we’ll still have some in the batteries for quite a while. Car companies like ours that are going to make electric cars in a high volume want to ensure we can access this important material. We also need to make sure the material for those vehicles is, in this case, mined in the correct way.
Are you sourcing from First Cobalt?
Fisker: We haven’t started making our vehicles yet. It’s about getting in early and understanding our supply lines. First Cobalt owns a very large mineral deposit in Idaho, and they have a refinery in Canada. They are doing exploration of this project because other things were mined in this belt before. It has quite a lot of cobalt. But they haven’t started mining.
We’ve heard automakers describe challenges in the current cobalt supply chain. Is that what you’re seeing?
Fisker: It’s very difficult because cobalt is mined in one place, refined in another, and mixed from different areas. In the end it’s hard to figure out where that cobalt truly came from and how it was mined.
Trent Mell: In the Congo, there’s artisanal mining in the cobalt states. There can be ethical operations that don’t involve children, forced labor, and things of that nature. You get tables or blankets set up in town where people sell their material. It finds its way invariably to a Chinese refiner. But once that gets blended with materials of an unknown origin, the whole batch is tainted.
Our head of exploration worked for First Quantum, so he knows Africa well. He lived in the DRC and Zambia with his family for about two years. As we started the company, we went there. For reasons everybody here knows too well, we got discouraged and decided to focus elsewhere.
How will First Cobalt guarantee that your cobalt is ethically mined and refined?
Mell: After a wide search, we landed in Idaho and Canada. Our refinery as well as our mining assets are here so ethical practices are easier to assure. We all come from big mining companies. In the case of our refinery, which could treat third-party material, we’re looking at possibly sourcing internationally. Our team understands the supply chain issues around the three Ts and gold as a result of Dodd-Frank, and we know how to certify a supply chain.
What about ensuring sustainable operations?
Mell: It’s about transparency. It’s about having safety, having everybody properly trained, having the right equipment, and having best-in-class environmental practices. Water quality is a huge issue for North America because invariably water is going to be an important source for milling. Also, you don’t want to contaminate the environment. There are codes in terms of maintaining and auditing your practices. Our people come from world-class mining operations. As we build this up, we want to bring those same standards to our company.
Could First Cobalt affect the global cobalt supply chain?
Mell: It’s going to be the clients — Fisker Inc., Apple, Samsung — that demand that their products not contain dirty cobalt.
Fisker: The carmakers will demand ethical cobalt. Right now we’re in this fuzzy space where it’s hard to check. In the future, when there are alternatives, you’re going to have to make sure you get your materials from the right place. There have been issues before with sweatshops and child labor in other industries. Eventually it surfaces and has to be dealt with. This will be the same in the electric car industry.
Mell: I believe that we are heading toward a bit of a deficit position in the cobalt market because EVs are just starting to take off, and yet lithium-ion ion batteries, including in phones and laptops, eat up half the global consumption of cobalt today. First we will see a reduction in the amount of cobalt in the battery, although it will not go away for the foreseeable future.
This is kind of a new world for miners. Idaho, geologically, is turning into a unique setting worldwide for cobalt exploration. We’re going to be hearing a lot more about America’s role in cobalt production over the next decade.
Speaking of mining, Caterpillar Venture Capital recently invested in Fisker Inc., which seemed surprising.
Fisker: It’s not just the automotive industry which is going electric. Caterpillar and Fisker are in two very different industries serving very different customers, but we’re both interested in being part of developing the next-generation game-changing battery technologies to power all kinds of vehicles.
Mell: From the mining perspective, Caterpillar equipment goes underground. You’ve got to consider the emissions and what that means for ventilation. And you’ve got opportunities for automation. The Fisker solid-state battery technology could play a big role in reducing some significant costs in the mining industry while also making the fleets safer in time.
Fisker: The global market will be so gigantic for electric vehicles and electric-powered heavy equipment that it will be the single largest consumer of batteries by far in the future. Therefore, it makes sense for companies like Caterpillar to be part of what’s happening with battery development. There are a lot of synergies to understand in this space because we are all going electric, and we all want the best batteries.