First Cobalt secures C$10 mln government backing for Canada refinery

Electra Battery Materials

16/12/2020 16:30

By Jeff Lewis
    TORONTO, Dec 16 (Reuters) - Canada's First Cobalt Corp
 FCC.V  said on Wednesday it has secured C$10 million in
government loans and grants, allowing it to accelerate startup
and expansion of North America's first cobalt refinery.
    Cobalt is crucial for the lithium-ion batteries used in the
fast-growing electric vehicle sector, and the financial backing
is the latest bet on the burgeoning industry by the Ontario and
Canadian governments.
    First Cobalt's cobalt refinery in Ontario could also ease
North America reliance on China, which dominates the supply
chain for rechargeable lithium-ion batteries.
    Under Wednesday's deal, Canada will provide a C$5 million
interest-free loan to First Cobalt while the Ontario government
will give the company a C$5 million non-repayable grant. 
    Trading in First Cobalt's shares on the TSX Venture Exchange
was halted on Tuesday pending news of the agreement.
    The company said funding will support restart of the
refinery, estimated to cost C$77 million. 
    The plant, located about 600 kilometers (373 miles) from the
U.S. border, would be the sole North American producer of
refined cobalt. Miner Glencore  GLEN.L  is to provide feedstock.
    At its peak the refinery will produce 25,000 tonnes of
battery-grade cobalt sulfate annually, which represent 5% of the
global market for refined cobalt, First Cobalt said.
    Canada and Ontario have stepped up financial supports for
EVs in hopes of spurring a domestic industry.
    Last week, Ottawa unveiled a C$3 billion innovation fund, in
part to develop a “battery ecosystem” from mineral extraction
and processing through to manufacturing and recycling.
    In October both governments agreed to support a C$1.8
billion overhaul of Ford Motor Co's  F.N  Oakville assembly
plant to manufacture EVs.  urn:newsml:reuters.com:*:nL3N2GJ2RS

 (Reporting by Jeff Lewis; Editing by David Gregorio)
 ((Jeff.Lewis@thomsonreuters.com; +1 647 200 7236))