Cobalt: Bill Gates, Bezos, Dalio Are On the Hunt for New Underground Supply

From Bloomberg:

A coalition of billionaires led by Bill Gates has thrown its financial weight behind a startup hoping to build a "Google Maps for the earth’s crust" to hunt for new sources of cobalt.

The startup, Kobold Metals, is using data-crunching algorithms to scour the globe for cobalt, in a bet that there may still be significant undiscovered sources of the metal that has become one of the world’s hot commodities thanks to its use in electric vehicle batteries.

The company has raised money from Silicon Valley venture capital firm Andreessen Horowitz and Breakthrough Energy Ventures, a fund backed by Gates and a dozen other tycoons including Jeff Bezos, Ray Dalio and Michael Bloomberg, owner of Bloomberg LP, the parent company of Bloomberg News.

Kobold Metals is betting it will be able to find new sources of the metal using what it calls "machine prospecting." The company is building a database of geological data that it then feeds into an algorithm, hunting for signals that indicate the likelihood of increased concentration of cobalt.

"What we’re building is basically Google Maps for the earth’s crust and below," said Connie Chan, partner at Andreessen Horowitz.

Kurt House, the chief executive officer of Kobold Metals, says the approach could succeed because mining companies have traditionally not focused on looking for cobalt.

The metal is a byproduct of copper or nickel mining in all but one of the world’s cobalt mines, and more than two thirds of global supply comes from the Democratic Republic of Congo.

"People just haven’t looked for the stuff," said House. "There’s very limited history of exploration at all outside of piggybacking on nickel and copper deposits."

Kobold Metals, based in Berkeley, California has already acquired several properties in North America where it hopes to explore for cobalt, he said, and plans to have around a dozen such prospective sites by the end of the year.

House wouldn’t disclose how much money the company had raised or at what valuation, saying only that Kobold Metals has "well over four years of capital right now."

The San Francisco Bay Area-based company is not alone in hoping to capitalize on growth in cobalt demand driven by the electric vehicles revolution. The price of the metal more than quadrupled from 2016 to last year, spurring a wave of new supply from miners like Glencore Plc and Eurasian Resources Group Sarl, as well as small-scale diggers in Congo....MORE