Electra Positioned to Capitalize on Surging Battery Materials Demand

• Electra Battery Materials (ELBM) is developing an integrated battery materials park in Canada, starting with a cobalt refinery set to commission by the end of this year.
• CEO Trent Mell discusses the company's recent activities, including trips to Korea to explore partnerships, off-take agreements, and supply chain collaborations.
• ELBM's conversations are shifting towards a broader vision involving not only cobalt but also a focus on de-risking North American nickel strategy.
• The company aims to establish commercial relationships and off-take contracts for its battery materials, particularly cobalt, with a view to broader collaborations around recycling and nickel supply.
• ELBM recently listed on Nasdaq for better exposure and liquidity, and they're considering options for funding future endeavors, including potential strategic investors or OEM contracts, while keeping an eye on market conditions.

About Electra Battery Materials

Electra Battery Materials (Electra) is a Canadian battery materials company focused on building an integrated battery materials park in North America. The company is currently constructing a cobalt refinery in Ontario, Canada that is on track to begin commissioning by the end of 2023. Beyond cobalt, Electra is also advancing projects focused on nickel and battery recycling as part of its strategy to provide a fully integrated battery materials supply chain in North America.

Interview with President & CEO, Trent Mell

Cobalt Refinery Nearing Commissioning

Electra’s flagship project is its cobalt refinery located north of Toronto, Canada. In a recent interview, CEO Trent Mell provided an update on the commissioning timeline and ongoing discussions with potential customers.

The cobalt refinery is on schedule to begin commissioning in January 2023. While battery manufacturing demand in North America is still ramping up, the initial production will be shipped to Europe, Japan and Korea under off-take agreements. These contracts will start with a portion of 2023 production and increase through 2024. By 2025, Electra is aiming to retain most output in North America to supply the emerging battery manufacturing industry.

Electra Not Seeking Project Financing

Unlike many mining projects, Electra is fully funded to production for its cobalt refinery. With cobalt prices over $30/lb, the existing financing is sufficient according to CEO Trent Mell. While the company could raise additional capital, it is prioritizing strategic partnerships and off-take agreements over project equity at this stage.

Partnership Discussions Accelerating

With the cobalt refinery nearing production, Electra has seen accelerating partnership discussions from auto companies and battery manufacturers. The initial focus is securing cobalt off-take agreements, but the conversations are expanding to future opportunities around nickel and recycling.

There appears to be growing recognition that a domestic battery supply chain is needed as auto companies ramp up EV production. This is driving increased interest in securing North American cobalt and nickel resources.

Recycling Strategy Takes ShapeIn addition to upstream mineral production, Electra is advancing a battery recycling strategy. The company is constructing a demonstration plant that will start up in August 2022. This will provide proof of concept for its recycling technology and intellectual property.

Battery recycling represents a major growth opportunity given the coming wave of EV batteries reaching end-of-life. It also provides a secondary source of cobalt, nickel and other battery materials. Electra’s integrated strategy aims to connect recycled battery materials back into its broader refining and materials production.

Iron Creek Cobalt Project Provides Optionality

Outside of its Ontario refinery, Electra also owns the Iron Creek cobalt-copper project in Idaho, USA. While main focus remains on the Canadian cobalt refinery, Iron Creek provides optionality for the company.

Recent drilling has identified new targets close to Iron Creek that could represent additional resource potential. The company is continuing exploration while keeping an open mind about eventually developing Iron Creek.

Potential partnerships around Iron Creek could involve an equity investment into the project itself or into Electra at the corporate level. This would provide capital to advance development while allowing Electra to maintain control.

Near-Term Catalysts

For Electra investors, key things to watch over the coming 3-6 months include:

• Ramp up to commissioning of cobalt refinery by end of 2023
• Recycling demonstration plant start up in August 2022
• Progress on off-take agreements and strategic partnerships
• Exploration results from Iron Creek project

With its cobalt refinery coming online soon, strategic partnerships evolving and new opportunities around recycling and nickel, Electra appears well positioned to capitalize on surging battery materials demand. The company provides rare exposure to the North American electric vehicle supply chain. For investors looking to play the energy transition, Electra warrants a close look.

Conclusion

With EV adoption accelerating and North American battery production ramping up, integrated battery materials companies like Electra stand to benefit. As the company nears commissioning of its Canadian cobalt refinery and advances its integrated strategy, it provides a compelling investment opportunity. Investors interested in the battery materials supply chain should keep Electra on their radar over the coming months.

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