Marks Electra's first commercial agreement in EV
supply chain
TORONTO, Sept. 22,
2022 /CNW/ - Electra Battery Materials
Corporation (NASDAQ: ELBM) (TSXV: ELBM) ("Electra") today
announced the signing of a three-year agreement to supply battery
grade cobalt to LG Energy Solution (LGES; KRX: 373220), a
leading global manufacturer of lithium-ion batteries for electric
vehicles. Electra has agreed to
supply LGES with 7,000 tonnes of battery grade cobalt from 2023 to
2025. The material will be supplied from the only cobalt sulfate
refinery in North America, located
north of Toronto, Ontario.
Electra will supply 1,000
tonnes of cobalt contained in a cobalt sulfate product in 2023 and
a further 3,000 tonnes in each of 2024 and 2025 under an agreed
pricing mechanism. In addition to the supply agreement,
Electra and LG Energy Solution
have agreed to cooperate and explore ways to advance opportunities
across North America's EV supply
chain, including, but not limited to, securing of sustainable
sources of raw materials. Financial terms of the supply
agreement were not disclosed.
"LG Energy Solution is a global leader in the electric vehicle
supply chain, and we are delighted to sign our first strategic
supply agreement with such an important player in the lithium-ion
battery market," said Trent Mell,
CEO of Electra. "This is only the
beginning of a larger strategic relationship with LG Energy
Solution involving our other assets and growth initiatives in the
North American battery supply chain."
"As we have recently announced our mid- to long-term strategy to
focus on North America, the
fastest growing EV market, these partnerships serve as a crucial
step towards securing a stable key raw material supply chain in the
region," said Youngsoo Kwon, CEO of
LG Energy Solution. "By establishing a strategic partnership with
Electra, a key critical material
supplier and only cobalt refinery in North America, LGES will continue to ensure
the steady delivery of our top-quality products, thereby further
advancing the global transition to EVs and ultimately to a
sustainable future."
"Today's announcement is great news for Canada," said the Hon. Francois-Philippe Champagne, Minister of
Innovation, Science, and Industry. "This agreement between
Electra and LG Energy Solution
will see Canadian critical mineral resources and Canadian workers
helping to build the car of the future. Through partnerships like
this one, Canada is cementing its
position as the world's green supplier of choice in the auto
industry and beyond."
"A key part of our government's plan to build Ontario is supporting partnerships like this
one between Electra and LG Energy
Solution," said Vic Fedeli,
Ontario's Minister of Economic
Development, Job Creation and Trade. "With our critical minerals
strategy, cutting-edge technology and world-class workforce,
Ontario has what it takes to build
the cars of the future, and we're proud to see more and more
companies come to Ontario for
exciting partnerships."
According to research by CRU, a leading provider of business
intelligence on the global metals, mining, and fertilizer
industries, China is currently
responsible for 71% of refined cobalt, 76% of refined nickel and
93% of refined manganese used in EV batteries. Favourable public
policy and growing EV adoption rates are accelerating the
development of a North American refining and battery recycling
ecosystem by Electra. The U.S.
Inflation Reduction Act underscores the importance of creating a
domestic EV battery supply chain by extending a $7,500 tax credit for vehicles that do not
contain critical minerals sourced from China and Russia.
Electra's low-carbon
hydrometallurgical refinery complex is located in Temiskaming
Shores, near the Sudbury Nickel Basin. The refinery is in the late
stages of commissioning and is expected to commence operations in
the spring of 2023. Cobalt sulfate provided under the term of the
contract with LGES will be sufficient to supply up to 1.5 million
full electric vehicles.
At full capacity, Electra's
facility will produce enough cobalt to supply up to 1.5 million
electric vehicles per year.
To meet growing customer demand, the Company announced on
June 22, 2022 that it is evaluating a
second refinery in the province of Quebec by 2025-26, which could source cobalt
from Electra's Idaho cobalt and copper project. There
are no other cobalt sulfate producers in North America today.
The Company is also developing black mass battery recycling
capabilities to recover lithium, nickel, cobalt, graphite, and
copper. A demonstration plant will be commissioned in the fall of
2022 to validate the Company's proprietary flow sheet, with
commercialization anticipated in 2023-24. Electra's other growth projects include the
construction of a battery grade nickel refinery and a manganese
refinery, to establish a fully integrated battery materials park
with a third-party cathode precursor (pCAM) manufacturer.
Electra announced the highlights of an engineering scoping
study related to development of an integrated facility on
September 8, 2022 that outlined a
path to growing nickel sulfate refining capacity in North America.
LGES and Electra will hold a
formal ceremony today, September 22,
in Toronto, celebrating the
signing of a term sheet, which commits the parties to key
commercial terms. Final legal documentation and signing of the
definitive agreement is expected to be concluded in the coming
months.
CIBC Capital Markets acted as exclusive financial advisor to
Electra.
About Electra Battery Materials
Electra is a processor of low-carbon,
ethically-sourced battery materials. Currently commissioning
North America's only cobalt
sulfate refinery, Electra is
executing a multipronged strategy focused on onshoring the electric
vehicle supply chain. Keys to its strategy are integrating black
mass recycling and nickel sulfate production at Electra's refinery located north of
Toronto, advancing Iron Creek, its
cobalt-copper exploration-stage project in the Idaho Cobalt Belt,
and expanding cobalt sulfate processing into Bécancour,
Quebec. For more information visit www.ElectraBMC.com.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Note Regarding Forward-Looking
Statements
This news release may contain forward-looking statements and
forward-looking information (together, "forward-looking
statements") within the meaning of applicable securities laws and
the United States Private Securities Litigation Reform Act of 1995.
All statements, other than statements of historical facts, are
forward-looking statements. Generally, forward-looking statements
can be identified by the use of terminology such as "plans",
"expects', "estimates", "intends", "anticipates", "believes" or
variations of such words, or statements that certain actions,
events or results "may", "could", "would", "might", "occur" or "be
achieved". Forward-looking statements involve risks, uncertainties
and other factors that could cause actual results, performance, and
opportunities to differ materially from those implied by such
forward-looking statements. Factors that could cause actual results
to differ materially from these forward-looking statements are set
forth in the management discussion and analysis and other
disclosures of risk factors for Electra Battery Materials
Corporation, filed on SEDAR at www.sedar.com. Although Electra
Battery Materials Corporation believes that the information and
assumptions used in preparing the forward-looking statements are
reasonable, undue reliance should not be placed on these
statements, which only apply as of the date of this news release,
and no assurance can be given that such events will occur in the
disclosed times frames or at all. Except where required by
applicable law, Electra Battery Materials Corporation disclaims any
intention or obligation to update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.
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SOURCE Electra Battery Materials Corporation