Electra receives $17.5M to help open northern Ont. cobalt refinery

Electra Battery Materials is one step closer to opening North America's first cobalt refinery in northern Ont. after the province pledged $17.5M to the project.

More funding was announced Friday for a $100 million cobalt refinery plant project just a few minutes south of Temiskaming Shores.

Cobalt is considered a key material in the race to build lithium-ion batteries, which power electric vehicles. Electra Battery Material Corp. is working to open the first battery-grade cobalt refinery in North America.

On Friday, those efforts received a $17.5 million boost when the Ontario government signed a term sheet to transfer millions to help get it open.

Electra CEO Trent Mell said major financial strides are being made to get the refinery up and running.

“This is going to be the very first critical minerals project to reach production of any sort of significance in Canada in many, many years,” Mell told CTV News on Friday.

In a media release, Vic Fedeli, Ontario’s Minister of Economic Development, Job Creation and Trade, said the province is committed to “building a self-reliant economy” that integrates mineral wealth from northern Ontario with the manufacturing might of southern Ontario.

“Electra’s investment in Temiskaming Shores will establish an integral link in the province’s critical mineral processing supply chains and fuel the next stages of Ontario’s leadership in electric vehicle battery manufacturing,” Fedeli said.

It will take about $100 million to complete refinery construction. Last summer, the Pentagon provided US$20 million. Discussions with the federal government for another $20 million announced in March are still ongoing.

“It’s really up to the lawyers to dot the I’s and cross the T’s on both contribution agreements -- the federal and provincial,” Mell said.

Electra is launching a restructuring plan, targeting an approximate 60 per cent reduction in convertible debt and a $30 million U.S. equity raise.

The refinery would add 50 new jobs and produce 6,500 tonnes of battery-grade cobalt sulfate annually. That’s enough to support domestic production of up to one million electric vehicles per year.

The plan is to sell up to 80 per cent of the material to LG Energy Solution Ltd., a South Korean battery manufacturer partnering with automakers to build plants in Canada and the U.S.

About 94 per cent of all the current supply of refined cobalt comes from China. Electra’s goal is to stand out as one of the few producers with no ties to foreign entities.

“Our stated mandate is to … enter the supply chain and reduce reliance on China, because we do have tensions that pop up here and there,” Mell said.

Aims to operate by 2027

“So, we will be 100 per cent of the market and we will be a preferred supplier.”

Electra aims to complete construction in 2026, with production operations starting in early 2027.

In addition to the cobalt sulfate refinery, Electra said its strategy includes nickel refining and battery recycling.

In 2023, the company operated a plant-scale black mass demonstration at its refinery complex, recovering lithium, nickel, cobalt and other critical minerals from batteries.

The province also said that, in the face of U.S. tariffs, it is advancing projects that will strengthen the province’s critical mineral supply chain and secure high-value jobs.

It notes that Electra’s project aligns with the goals of the province’s Critical Minerals Strategy, which seeks to meet the soaring global demand for critical minerals by leveraging Ontario’s wealth of natural resources through increased domestic processing capacity.