Temiskaming refinery builder signs ink supply deal with global battery manufacturer

The developer of the Temiskaming refinery, Electra Battery Materials, has signed a three-year cobalt supply agreement with LG Energy Solution (LGES), one of the world’s largest manufacturers of lithium-ion batteries.

This is Electra’s first commercial agreement to supply cobalt sulfate from its Temiskaming refinery, which is currently under construction and scheduled to begin production next spring.

Electra has agreed to supply South Korea-based LG with 7,000 tons of battery-grade cobalt from 2023 to 2025. In detail, this represents 1,000 tons of cobalt contained in a cobalt sulfate product in 2023 and 3,000 tonnes in 2024 and 2025 under an agreed pricing mechanism.

Financial terms of the deal were not disclosed. The term sheet was signed in Toronto on September 22. The signing of a definitive agreement will occur in the coming months, Electra said in a press release.

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In the release, Electra hinted that LG could help them secure other sources of raw materials needed to supply the North American electric vehicle (EV) supply chain.

“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 a significant player in the lithium-ion battery market,” said Trent Mell. , CEO of Electra, in a statement.

“This is just the beginning of a broader strategic relationship with LG Energy Solution involving our other assets and growth initiatives in the North American battery supply chain.”

LG wants to establish itself firmly in North America to supply the automobile industry of this continent.

In a statement, CEO Youngsoo Kwon said the deal is part of his mid to long-term strategy to focus on the growing North American electric vehicle market and secure a key part of the chain. supply from the start.

“By establishing a strategic partnership with Electra, a critical materials supplier and the only cobalt refiner in North America, LGES will continue to ensure the consistent delivery of our premium products, advancing the global transition to electric vehicles. and, ultimately, towards a sustainable future.”

Electra is modernizing and expanding the former Yukon refinery located in the Temiskaming region of northeastern Ontario. The plant is located between the town of Cobalt and the town of Temiskaming Shores.

Electra’s comprehensive construction plan over the next four years is to create an $800 million battery materials industrial park to process cobalt, nickel and manganese into a mixed precursor material that battery makers from electric vehicles need.

The company is looking for an industrial partner to join them in Temiskaming and build this precursor cathode manufacturing plant (pCAM).

This complex will be the first of its kind in North America. China dominates the global refining market for battery-grade metals.

Also under construction at Electra, a battery recycling operation. A “black mass” pilot plant will come into operation on the site this fall. The processor takes valuable materials extracted from crushed used batteries – such as lithium, nickel, cobalt, graphite and copper – and recycles them into useful materials for battery customers. The complete recycling plant will enter service in 2023-2024.

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The cobalt that will be transformed into cobalt sulphate in Temiskaming will be imported from the Democratic Republic of Congo. Eventually, Electra wants to put its cobalt exploration property in Idaho into production and introduce its own feed into the refinery.

Electra said that at full capacity, its Temiskaming site will produce enough processed cobalt to power up to 1.5 million electric vehicles per year.

Even politicians are delighted with the news.

“This agreement between Electra and LG Energy Solution will enable Canada’s critical mineral resources and Canadian workers to help build the car of the future,” said Federal Minister of Innovation, Science and Industry Francois -Philippe Champagne, in the press release.

“Through partnerships like this, Canada solidifies its position as the world’s green supplier of choice to the automotive industry and beyond.

Provincial Economic Development, Job Creation and Trade Minister Vic Fedeli said Queen’s Park supports industry partnerships like these.

“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 are coming to Ontario for exciting partnerships.

Virginia C. Taylor