- The financial union of big tech (AI) and mining promises an explosive future, potentially triggering a capital tsunami across the globe.
- KoBold Metals has recently raised a whopping US$195 million from prominent investors supporting their cause.
- The newly funded mining prodigy is all set to tap into an untouched copper reservoir in Zambia backed by a hefty US$150 million investment.
The possibilities of AI are manifesting in critical global economic sectors, the latest being the mining industry. The financial union of big tech (AI) and mining promises an explosive future, potentially triggering a capital tsunami across the globe.
This is evident from the moves already happening in the industry, and here are a few examples of them.
KoBold Metals raises US$195 million from investors
KoBold Metals, a digital exploration firm based in California, is leading the application of AI in mining. The startup has recently raised a whopping US$195 million from prominent investors supporting their cause. This has rocketed their valuation to a staggering US$1,15 billion.
The investors include Andreessen Horowitz and Breakthrough Energy Ventures, backed by visionaries like Jeff Bezos and Bill Gates.
What exactly does KoBold Metals do
KoBold Metals focuses on digital exploration by applying statistical modelling, big data aggregation, and foundational ore-deposit science to improve the pace and efficacy of natural resources exploration materially. They deploy their Machine Prospector tool, Human Prospector team, and TerraShedSM to discover new ethical sources of Nickel, Copper, Cobalt, and Lithium critical for the electric vehicle revolution.
As stated on their website, the startup invests over US$60 million annually across 60+ projects on three continents.
Identifying the market gap
The demand for electric batteries is remarkably increasing as the world moves to zero carbon emission through electric vehicles. The increased battery demand directly translates to increased demand for metals like Lithium, Cobalt, and Nickel, essential for battery manufacturing.
However, the supply of these minerals is way stretched to meet the current and expected demand. The global mining sector must invest over US$1.7 trillion over the next fifteen years to secure the critical minerals needed in electric vehicle production to meet the rising demand.
Furthermore, the path to discovering minerals is marred with obstacles, and a supply crisis is looming. More than 99 per cent of mining explorations fail to become successful due to the manual discovery processes in place today. The industry spends three times more to make discoveries than 30 years ago.
“The success rates of finding new deposits have been declining. It is hard to see how we will get sufficient discoveries without technological breakthroughs,” the CEO of KoBold Metals, Kurt House, said.
Kobold Metals has built a full-stack digital prospecting engine using computer vision, machine learning, and data analysis to find materials needed for electric vehicles and the renewable energy-only dream. The engine aims to make the discovery process cheaper and more efficient by using ore-deposit science and machine learning algorithms.
KoBold Metals focuses on Africa
KoBold Metals’ first science destination is President Hichilema’s state, Zambia. The newly funded mining prodigy is all set to tap into an untouched copper reservoir, Mingomba copper-cobalt mine, in Zambia, backed by a hefty US$150 million investment.
As part of the massive deal, KoBold Metals agreed to pay US$115 million to the owners of the copper mine, pumping the remaining US$35 million to exploration. In exchange, they received a majority stake in the Mingomba deposit, formerly the Lubambe extension project.
Tech Companies invest heavily in mining
The breakthrough between big tech and AI is here, evident from the heavy investment from big tech giants. Car companies like Tesla, Volvo, Ford, and Volkswagen are racing to cut deals with mining companies.
Earlier this year, General Motors invested US$650 million into Lithium Americas. Additionally, Mercedes Benz penned a contract with a Lithium supplier, a deal that cost them over US$1.5 billion.
Artificial Intelligence is the key to locating the following sources of tomorrow’s materials. The technology will have explosive potential when and if they will apply it in Africa.