Canada in 'active discussions' with EV supply chain companies - minister

Electra Battery Materials

04/05/2022 17:22

By Steve Scherer
    OTTAWA, May 4 (Reuters) - Canada is talking to a number of
companies interested in setting up production in the electric
vehicle (EV) supply chain, the industry minister said, as the
government seeks to cut carbon emissions to net zero by 2050 and
play a role in the shift toward greener cars.
    There are "very active discussions with a number of players"
to develop an EV supply chain, Industry Minister
Francois-Philippe Champagne said in an interview last week. 
    Champagne did not name the companies, only saying he spoke
to representatives of Volkswagen  VOWG_p.DE  last week, and has
recently talked to executives from companies in the United
States, Japan and Korea.
    Canada is urging critical minerals producers and processors
to scale up production. It has invested in EV projects through a
multi-billion dollar fund set up in 2020, and last month pledged
C$3.8 billion ($3 billion) over eight years to help boost the
production and processing of critical minerals used for
EVs. urn:newsml:reuters.com:*:nL2N2W52SE
    Canada and the United States want all sales of passenger
vehicles to be zero emissions by 2035.
    In March, Stellantis  STLA.MI , the parent of Jeep and
Chrysler, said it would build an EV battery JV with South
Korea's LG Energy Solution  373220.KS  in Windsor, across the
border from Detroit, which Champagne called a "watershed
moment." urn:newsml:reuters.com:*:nL5N2VQ1C9  urn:newsml:reuters.com:*:nL2N2WU18T
    
    BLESSED WITH KEY MINERALS
    The government has met with industry players to establish a
strategy it hopes will make Canadian minerals, like lithium,
cobalt and nickel, key to EV production in North America,
according to chief executives in the sector and the minister.
    The plan will be completed this year, government sources
said without providing details.
    It could not happen fast enough. Electric carmakers Rivian
Automotive Inc  RIVN.O  and Tesla  TSLA.O  this year warned of
future battery supply constraints due to a lack of raw
materials. 
    Canadian critical mineral miners like Nouveau Monde Graphite
Inc  NOU.V , Nemaska Lithium Inc, Electra Battery Materials Corp
 ELBM.V , and Avalon Advanced Materials Inc  AVL.TO  want to
meet the demand.  
    Nouveau Monde aims to scale up its production of
graphite-based anode material to 45,000 tonnes per year by 2025,
according to a spokeswoman. 
    Nemaska is focusing on construction of its Whabouchi lithium
mine in Quebec and a conversion plant, with the aim of producing
about 34,000 tonnes per year, CEO Spiro Pippos said.
    Electra is expanding a refinery for battery-grade cobalt and
nickel sulfate in Temiskaming Shores, Ontario, and aims to
produce materials needed for lithium-ion batteries by 2025,
according to CEO Trent Mell. 
    Avalon, which plans to refine lithium in partnership with a
unit of India's Essar Group in Thunder Bay, Ontario, said
support from different levels of government was key.  
    "What we've needed all along is to show the potential
end-users in the manufacturing space that the province is
willing to help create the supply chains on the critical
materials they need in their technologies," Avalon CEO Donald
Bubar said.
    But BHP Group Ltd  BHP.AX , the world's largest listed miner
that moved its copper and nickel exploration offices to Toronto
last year, needs help to meet emissions targets in order to
deliver critical minerals.
    "When I look at Canada, I think net zero by 2050 is
fantastic, but I've got a bigger challenge," Rag Udd, BHP's
president of Minerals Americas, said on Monday in Toronto. "How
do we get those (low-emission) power sources? How do we work
with the provinces to actually induce that?" 
    William Adams, head of battery materials research at British
commodities price reporting group Fastmarkets, has been warning
of mineral shortages if production is not scaled up.
    "Canada is blessed... It's got nickel, it's got cobalt, and
it's got lithium," Adams said. "But like everywhere else, it
needs a lot more investment in all these projects."
($1 = 1.2878 Canadian dollars)

 (Reporting by Steve Scherer, with additional reporting by Denny
Thomas in Toronto
Editing by Marguerita Choy)
 ((steve.scherer@thomsonreuters.com; +1-647-480-7889;))