Canada’s Electra Battery Materials Corp. has received a $20 million award from the US government to build a cobalt plant close to North America’s automotive heartland.
The funds will support construction of a cobalt sulfate facility in Ontario that will be North America’s only refinery for the material used in lithium-ion batteries for electric vehicles, Electra said Monday in a statement. The $250 million project is about 500 kilometers (310 miles) north of Toronto at Temiskaming Shores.
The US Defense Department said separately that the award will help develop North American production of a key material for large capacity batteries and, once completed, will benefit the region’s growing EV supply chain.
The funding is the latest in a series of investments the Pentagon has put toward North American mining companies as part of a push to secure metals needed for EV manufacturing and the transition away from fossil fuels.
Prices for cobalt, the majority of which is processed in China, have plunged from a peak about two years ago in part because of Chinese firms that ramped up production faster than traders anticipated. Toronto-based Electra, which has a market value of about $28 million, paused construction of the project last year due to low prices, and after revealing the plant would cost much more than previously anticipated.
“We’re not in a free market, with China subsidizing producers and overproducing,” chief executive officer Trent Mell said Monday in an interview. “I think it’s essential that, if we’re going to build our own domestic supply chain, we have this financial support.”
Mell said he’s in talks to get more funding from the Canadian government, which awarded the firm C$5 million ($3.7 million) in June.
