US awards $20 million for construction of cobalt refinery; Canadian company Electra will build the plant north of Toronto

 The U.S. Department of Defense (DOD) has awarded Canada-based Electra Battery Metals $20 million to build a cobalt processing plant. The award was made pursuant to Title III of the Defense Production Act (DPA) to expand domestic production capability and is funded through the Additional Ukraine Supplemental Appropriations Act.

The funds will support the construction and commissioning of North America’s only cobalt sulfate refinery, capable of producing battery-grade materials for lithium-ion batteries.

“Electra is committed to strengthening the resiliency of the North American battery supply chain,” said Electra chief executive officer Trent Mell. “We are grateful to the U.S. Department of Defense for its support. On issues of national security, there are no borders between Canada and the United States. We are proud to partner with the U.S. government to build a strong North American supply chain for critical minerals.”

The DOD said 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 electric-vehicle (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.

The $250 million refinery project is located north of Toronto, in Temiskaming Shores, and is projected to have the lowest carbon footprint in the world. Electra is expanding an existing plant, with permits in hand, construction well underway, and most long-lead custom equipment at site.
Once fully commissioned, the facility can produce 6.5 kt/a (7,100 stpy) of cobalt, which would support the production of more than 1 million EVs annually. LG Energy Solution will purchase up to 80 percent of capacity over the first five years, and several buyers are now competing for the remaining production. The cobalt feed material will be ethically sourced from Glencore and Eurasian Resources Group mines in the Democratic Republic of the Congo — material that would otherwise be shipped to China.

In addition to cobalt refining, Electra plans to produce other battery materials that will strengthen the resiliency of the North American supply chain. In 2023, the company operated a plant-scale black mass demonstration plant at its refinery complex, recovering lithium, nickel, cobalt and other critical minerals from batteries. The company is also contemplating a second cobalt sulfate facility in Bécancour, Quebec, and a strategically located North American nickel sulfate plant.