Electra lines up Ontario funding for cobalt refinery

Electra Battery Materials (NASDAQ, TSXV: ELBM) has lined up C$17.5 million ($12.6 million) in Ontario government funding for its proposed cobalt refinery in Temiskaming Shores — seen as a critical project to the province’s critical mineral processing supply chain. Shares of the company shot up.Under a term sheet with Invest Ontario signed on Friday, the province would commit to this funding as part of a trilateral package of government support, following the US Department of Defense’s $20 million award in August 2024 and ongoing discussions with the Government of Canada. In total, the company could receive as much as $48 million (C$64 million) in government contributions, representing more than half of the C$100 million investment required to complete the project.Construction activities had previously been halted for nearly two years due to cost overruns and supply chain disruptions, but these government support allowed Electra to resume the project in June. When work was suspended in August 2023, the company was still about $60 million short.With the latest funding commitment, Electra’s shares skyrocketed by more than 20% by midday. On the NASDAQ, it traded at above $1.00 for the first time in nearly a month, with a market capitalization of $15.3 million.Toronto-headquartered Electra says the C$17.5 million from Invest Ontario would replace a previously arranged $20 million corporate investment. To support this new funding plan, it has also launched a comprehensive restructuring, targeting an approximate 60% reduction in convertible debt and a $30 million equity raise.Critical cobalt refineryOnce operational, the facility is expected to become the first in North America dedicated to producing battery-grade cobalt sulfate. With an estimated annual output of 6,500 tonnes, the refinery would support the production of up to 1 million electric vehicles from domestically sourced battery material. Currently, about 90% of the global cobalt sulfate supply comes from China, leaving North American manufacturers heavily exposed to supply shocks.Electra, which started the project back in 2020, says the facility will play a critical role in reinforcing Canada’s battery materials supply chain and reducing reliance on foreign sources.“Establishing a domestic supply of battery-grade cobalt is essential to reducing reliance on foreign-controlled supply chains, safeguarding economic and energy security, and ensuring that Canada plays a leading role in the global energy transition,” Electra’s CEO Trent Mell commented in a press release Friday.“Electra’s investment in Temiskaming Shores will establish an integral link in the province’s critical mineral processing supply chains and fuel the next stages of Ontario’s leadership in electric vehicle battery manufacturing,” Vic Fedeli, Minister of Economic Development, Job Creation and Trade, added.Weiter zum vollständigen Artikel bei Mining.com Weiter zum vollständigen Artikel bei Mining.com