Electra Battery Materials Secures Funding, Advances Refinery and Recycling Projects in Q1 2025

Electra Battery Materials Corporation (NASDAQ: ELBM; TSX-V: ELBM) has started 2025 with significant momentum, advancing its position as a leader in North America's critical minerals supply chain. The first quarter of 2025 has been marked by several strategic developments that strengthen the company's foundation for future growth. Key achievements include the initiation of a feasibility study for a commercial-scale battery recycling refinery, securing significant government funding support for its flagship cobalt refinery, forming new partnerships, and making progress on its Idaho exploration properties. With most of the required funding now arranged for the completion of North America's first and only cobalt sulfate refinery, Electra is poised to play a crucial role in establishing a domestic supply chain for electric vehicle battery materials, reducing North America's reliance on Chinese refiners.

Corporate Developments

New Board Appointment

In February, Electra strengthened its board of directors with the appointment of Alden Greenhouse, currently the Vice-President of Critical & Strategic Minerals for Agnico Eagle Mines Limited. Mr. Greenhouse brings extensive experience in critical and strategic minerals, coupled with strong financial acumen and deep understanding of the mining sector. His appointment reflects Electra's ongoing commitment to building a board with diverse expertise to drive the company's strategic growth. Mr. Greenhouse has subsequently been appointed as Chair of the Audit Committee.

Strategic Partnerships

In February, Nord Precious Metals Mining Inc. announced that it had established a framework with Electra through a Memorandum of Understanding to process cobalt-bearing silver concentrates at Electra's Ontario cobalt sulfate refinery. This agreement addresses both critical mineral supply challenges and environmental remediation of historic mining sites by recovering valuable metals from mining tailings and waste rock.

This systematic approach to metals recovery aligns with Ontario's modernized Recovery Permit system, which streamlines the regulatory process for tailings and waste rock reprocessing while maintaining environmental standards. The partnership demonstrates Electra's ability to leverage its refining expertise to unlock value from historic mining materials while advancing the clean energy transition.

Financial Flexibility

In March, Electra announced an agreement with the holders of its senior secured debt that enhances the company's financial flexibility. Under this agreement, lenders have agreed to defer all interest payments until February 15, 2027, allowing Electra to invest its capital towards completing its cobalt refinery rather than debt servicing.

The agreement covers all outstanding 8.99% senior secured convertible notes (the "2028 Notes") and 12% senior secured convertible notes (the "2027 Notes"). As consideration for this deferral, Electra will pay additional interest of 2.25% per annum on the 2028 Notes and 2.5% per annum on the 2027 Notes. This agreement reflects a constructive partnership with stakeholders and reinforces Electra's commitment to responsible capital management.

Equity Financing

In late March, Electra announced and successfully closed the first tranche of an oversubscribed non-brokered private placement, raising aggregate gross proceeds of approximately US$3.08 million. The offering consisted of units priced at US$1.12, with each unit including one common share and one warrant exercisable at US$1.40 for 18 months. The strong investor response demonstrates confidence in Electra's vision and strategy. Several company insiders participated in the offering, including CEO Trent Mell, CFO Marty Rendall, and multiple directors and executives, further aligning management interests with shareholders.

Operational Developments

Battery Recycling Feasibility Study

In January, Electra announced the commencement of a feasibility-level engineering study to build a battery recycling refinery adjacent to its cobalt refinery north of Toronto. This study builds on the technology and expertise accumulated during a year-long black mass recycling trial, whereby Electra produced technical grade lithium and a nickel and cobalt product from end-of-life lithium batteries.

The feasibility study represents a critical step toward a commercial recycling facility, leveraging knowledge gained from the previous 40-tonne demonstration plant. Electra has retained Green Li-ion, a U.S.-based company that provides engineered services and recycling technology solutions, to assist with the engineering and feasibility studies.

Through its joint venture with the Three Fires Group, Aki Battery Recycling, Electra is establishing relationships with North American battery makers, offering a closed-loop partnership to return critical minerals back into the domestic supply chain. Currently, most black mass produced from battery scrap is shipped to Asia for refining, depriving automakers of the ability to control their critical minerals supply chain.

Federal Government Support for Cobalt Refinery

A major development came in March when Electra announced receipt of a Letter of Intent (LOI) for proposed funding of C$20 million from the Canadian federal government. The funding will support completion of construction and commissioning of North America's first battery grade cobalt refinery, which will enable domestic production of up to one million electric vehicles annually.

To date, Electra has arranged US$54 million in non-dilutive funding, including US$34 million in government support – comprised of both a binding contract and a non-binding letter of intent – and a US$20 million strategic investment proposal. The company estimates the capital cost to complete the cobalt refinery at approximately US$60 million, excluding first fills and commissioning costs.

Following this announcement, Electra welcomed a visit from the Honourable Marc G. Serré, Parliamentary Secretary to the Minister of Energy and Natural Resources and Member of Parliament for Nickel Belt, and the Honourable Anthony Rota, Member of Parliament for Nipissing–Timiskaming, to its cobalt sulfate refinery site in Ontario. The site visit demonstrated government engagement in building a domestic critical minerals supply chain.

Exploration Developments

Idaho Copper-Cobalt Properties

In February, Electra provided an update on its exploration efforts at the CAS Property in the Idaho Cobalt Belt, highlighting high-grade gold values alongside cobalt and copper mineralization. Recent and historical data from CAS underscore the growing importance of the property to Electra's Idaho exploration strategy.

With gold trading near its all-time high and a strong long-term outlook, the presence of high-grade gold mineralization at CAS adds further strategic value to Electra's Idaho holdings. Notable historical drilling results include:

• IC03-02: 6.2m from 77.4m at 8.3 g/t Au and 0.51% Co
• IC03-03: 1.5m from 72.8m at 8.5 g/t Au and 0.54% Co
• IC03-04: 4.6m from 128.0m at 8.3 g/t Au and 0.34% Co
• IC03-07: 3.0m from 41.1m at 9.2 g/t Au and 0.08% Co

The Idaho Cobalt Belt is recognized by the U.S. Geological Survey as the largest undeveloped primary cobalt resource in the United States. Electra's 10-year exploration permit, secured in late 2024, covers 91 designated drill pad locations and hundreds of potential drill targets, providing the company with long-term flexibility to develop these resources.

Innovation Highlights

Recycling Technology Advancement

Electra's innovation focus in early 2025 has centered on advancing its proprietary battery recycling technology. Building on its successful 2023-2024 demonstration plant that achieved technical grade lithium carbonate production and high-quality nickel-cobalt MHP, the company is now taking steps toward commercial-scale operations.

As Mark Trevisiol, Electra's Vice President of Project Development, noted:

"Having developed a proprietary hydrometallurgical process, this feasibility study is a critical step in advancing towards a commercial recycling facility. It builds on the knowledge gained from our previous 40-tonne demonstration plant and allows us to optimize our processes for a scalable commercial operation."

Dr. George Puvvada, Electra's Vice President of Metallurgy & Technology, added:

"At Electra, we are applying in-house innovation and technology in an incremental fashion to our existing hydrometallurgical process. This approach is about leveraging a strong, established foundation and the expertise of our experienced team to minimize risk."

Future Outlook

As outlined in the company's March 31 update, Electra's immediate priority remains the completion of its cobalt refinery construction, with a phased approach to growth:

1. Cobalt Refinery Commissioning: Completion of the recommissioning of the refinery to produce at an initial rate of 5,000 tonnes per annum of battery cobalt contained in cobalt sulfate from cobalt hydroxide.
2. Capacity Expansion: 12-month permit amendment process and expansion of certain circuits to increase cobalt production to 6,500 tonnes per annum of battery grade cobalt sulfate, reaching the nameplate capacity of the crystallization circuit.
3. Battery Recycling Implementation: Establishment of black mass recycling operations, recovering lithium, nickel, cobalt and other critical metals, supported by the Aki Battery Recycling joint venture.
4. Geographic Expansion: Potential addition of North American cobalt sulfate production capacity and a strategically located nickel sulfate plant.

With most of the critical equipment already delivered to the refinery complex in Ontario and major funding components secured, Electra is well-positioned to complete construction and move toward commissioning in the near term. The company has also secured sufficient cobalt hydroxide feed material to meet the refinery's annual capacity through agreements with ERG and Glencore AG, sourced from the largest non-Chinese cobalt producers in the world.

Electra CEO Trent Mell summed up the company's position:

"With more than US$50 million in non-dilutive funding arranged to date, including committed and conditional capital, we are making strides towards resuming construction and commissioning of North America's first, and only, cobalt sulfate refinery."

As geopolitical tensions continue to highlight the vulnerability of critical mineral supply chains, Electra's progress in establishing domestic refining capabilities for battery materials positions the company at the forefront of North America's push for energy independence and supply chain security.

Electra's low carbon hydrometallurgical refinery in Canada is permitted and has an estimated current replacement value of approximately US$200 million. With the majority of required funding now arranged, the company is on track to complete this strategic asset and contribute significantly to North America's electric vehicle battery supply chain.

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