Quebec’s Nouveau Monde Graphite inks anode material supply deal with Panasonic

Quebec’s Nouveau Monde Graphite Inc. (NMG) has signed a non-binding anode material supply deal with Panasonic as electric vehicle supply chain investors continue to circle junior miners in Canada’s battery materials sector.

The Saint-Michel-des-Saints, Que.-based graphite company said the memorandum of understanding inked with the battery cell maker Oct. 20 confirms Panasonic’s intentions to work toward a multi-year offtake agreement for a “significant portion” of NMG’s anode output.

Company CEO Eric Desaulniers said the deal comes at a “pivotal time” as NMG advances development of what would be North America’s largest integrated graphite anode production hub.

“It is set to provide NMG with a solid commercial foundation for deploying our Phase 2 commercial operations,” he said in a release.

NMG is developing a graphite mine in Saint-Michel-des-Saints, about 150 kilometres north of Montreal, as well as a plant in Bécancour, Que. that will process the graphite into anode active material, which is used for the negative side of lithium-ion batteries. It plans to rely on all-electric mining equipment and Quebec’s stores of hydropower to remain carbon neutral from graphite extraction through anode production.

Kazuo Tadanobu, CEO of Panasonic Energy, said the strategic partnership will give the battery maker the ability to establish an environmentally friendly source of anode material as it builds out its North American supply chain.

The two parties will work toward formalizing the supply deal in the coming months, NMG said.

Meantime, the Quebec miner locked in US$50 million in funding from new and existing investors it will use to continue development on its Matawinie mine in Saint-Michel-des-Saints and its processing plant in Bécancour.

Japan’s Mitsui & Co. will invest $25 million in NMG in the form of convertible notes, while existing investors Pallinghurst Group and provincially owned Investissement Quebec will each invest a further $12.5 million.

The tentative supply deal and fresh funding for NMG comes as an increasing number of international automakers and battery cell makers inch toward firm agreements to purchase lithium, cobalt, nickel and other key materials from Canadian miners.

In September, LG Energy Solution, which is building a new battery cell plant in Windsor, Ont. with partner Stellantis, signed three such agreements with Canadian battery materials firms. Mercedes-Benz Group announced it was working toward a similar deal with Vancouver-based Rock Tech Lithium Inc. several weeks earlier.

Leveraging the added funding and new partnership, NMG said it will focus the next several months on finalizing the design of its two Quebec facilities before it makes a final investment decision for the project.

It estimates construction of the mine and processing plant will cost approximately $1.4 billion and take 28 months to complete.

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