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Future mine deal underscores vast EV battery materials need Metal Tech News - October 10, 2022
Stellantis has entered into a preliminary agreement to acquire nickel and cobalt sulphate produced at a future mine at GME Resources' mine project in Western Australia.
Controlled Thermal Resources' Hell's Kitchen project has the potential to produce up to 1,100 megawatts of renewable electricity and 300,000 metric tons of near-zero-carbon lithium from Salton Sea area geothermal resource per year.
In a move that demonstrates automakers need all the battery materials that can possibly be produced by the global mining sector, Stellantis has entered into a preliminary agreement to buy battery-grade nickel and cobalt from a future mine developed at GME Resources Ltd.'s NiWest project in Western Australia.
NiWest is an advanced stage nickel-cobalt project that lies less than 20 miles away of Glencore's Murrin Murrin operation, the largest nickel-cobalt mine and refinery in Australia.
GME recently completed an updated prefeasibility study that details a future mine at NiWest that would produce 19,200 metric tons of nickel and 1,400 metric tons of cobalt annually over the first 15 years of operation. A definitive feasibility study for this nickel-cobalt operation is slated for completion toward the end of 2023.
The project would still need to go through permitting and development before it feeds the first nickel and cobalt into supply chains starving for these metals for lithium-ion batteries that power EVs.
Stellantis – which owns globally recognized auto brand such as Alfa Romeo, Citroën, Chrysler, Dodge, Jeep, Lancia, Maserati, Opel, Peugeot, and Ram – has signed a non-binding memorandum of understanding with GME for battery-grade nickel and cobalt sulphate products from this operation when it comes online.
"We're very pleased with how our discussions have progressed and we now look forward to progressing more detailed negotiations in parallel with the start of the definitive feasibility study for the NiWest nickel-cobalt project," said GME Resources Managing Director Paul Kopejtka. "A definitive agreement with Stellantis would be a critical step in being able to progress the NiWest Project through to commercial operations."
Having a major automaker like Stellantis enter into a future sales agreement on a project that is still years away from production underscores the urgent need for EV battery materials.
Benchmark Mineral Intelligence, a global leader in lithium battery supply chain analysis, estimates that more than 300 new mines will need to come online by 2035 to keep pace with the enormous demand driven by automakers making the rapid transition to e-mobility.
For Stellantis, the deal with GME helps secure a potential future source of the battery materials needed to achieve the objectives of its Dare Forward 2030 strategic plan – transitioning 100% of its European and half of its North American passenger car and truck sales to electric models by the end of the decade.
"Every day, Stellantis is working to provide our customers clean, safe affordable, cutting-edge freedom of mobility," said Maxime Picat, the chief purchasing and supply chain officer at Stellantis. "Securing the raw material sources and battery supply will strengthen Stellantis' value chain for electric vehicle battery production and equally important, help the company achieve its aggressive decarbonization target."
Toward these goals, Stellantis has entered into similar agreements to purchase future lithium from Vulcan Energy Resources Ltd.'s Zero Carbon Lithium project in Germany's Rhine River Valley; and battery-grade lithium hydroxide from Controlled Thermal Resources Ltd.'s Hell's Kitchen project in the Salton Sea area of Southern California.
"We continue our quest of forming strong relationships with partners who share our values as we collectively fight against global warming and provide clean, safe and affordable mobility to our customers," Stellantis CEO Carlos Tavares said earlier this year.
Further details of Stellantis' offtake agreements with Controlled Thermal Resources and Vulcan Energy Resources can be read at Stellantis orders Hell's Kitchen lithium in the June 2, 2022 edition of Metal Tech News and Stellantis invests in Zero Carbon Lithium in the June 24, 2022 edition of Metal Tech News, respectively.
With more than 16 years of covering mining, Shane is renowned for his insights and and in-depth analysis of mining, mineral exploration and technology metals.
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