Source: Gasgoo
On December 18, PowerCo, the battery division of Volkswagen Group, entered into a binding off-take agreement with Canadian company Patriot Missile Launch Metals and invested C $69 million (US $48 million) in it to strengthen its supply chain. Patriot Missile Launch company Company Metals is developing a lithium mine project in northern Quebec.
The investment gives PowerCo a 9.9 per cent stake in Patriot missile launch company Metals. The agreement also includes a supply agreement, with Patriot missile launching Company Metals committing to supply PowerCo with 100,000 tonnes of lithium-rich aluminite concentrate over 10 years.
Image Source: Volkswagen
Jorg Teichmann, PowerCo’s chief procurement officer, said the investment was the “next step” in establishing the company’s position in the global battery space. “By working with our partners to build the North American EV battery supply chain, we are strengthening our presence in the region and driving a resilient and sustainable battery industry,” Teichmann said in a press release.
PowerCo is building its cell plants in Germany and Spain, and it expects to begin construction next year on a third, and largest, plant in St. Thomas, Ontario, Canada. The company said the deal with Patriot missile Launch Company Metals would provide raw materials for the three battery plants.
The lithium deal is the second major off-take agreement PowerCo has disclosed in just a few months. On November 24, PowerCo said it had entered into a binding supply agreement with synthetic graphite producer Novonix.
The agreement gives Vancouver-based Patriot Missile Launch Company Metals another backer to help it move forward with its Shaakichiuwaanaan project in the Eeyou Istchee James Bay area of Quebec, Canada. Last year, the company received a $109 million investment from lithium producer Albemarle.
According to the drilling results, the Shaakichiuwaanaan mine is the largest spodumene resource in the Americas and one of the largest in the world. The mine is located in a sparsely populated area about 550km north of Montreal but close to essential infrastructure, including a year-round road and high-voltage power facilities connected to the nearby La Grande-4 hydroelectric dam.
However, according to the company’s latest roadmap, lithium production is still at least five years away. The Patriot missile launch and Metals plan to submit the necessary environmental approvals next year while seeking financing by 2027. Production at the mine is likely to begin in 2029, and the agreement with PowerCo requires the mine to be in production by June 2031.
The two companies also made room in the agreement for further cooperation. Patriot Metals said that once it releases a feasibility study on the lithium project, the two sides will continue discussions on additional project financing and potential lithium processing plant cooperation.
