Electra Battery Materials Gets Non-Binding Deal for $20 Million to Fund Cobalt Refinery, to Raise US$3.5 Million in Private Placement

06:58 AM EDT, 03/24/2025 (MT Newswires) -- Electra Battery Materials ( ELBM ) , which traded 9.7% lower pre-market on Monday, said it has received a non-binding letter of intent from the Canadian government for proposed funding of $20 million to support the completion of its cobalt refinery complex project.

The project, located north of Toronto, is North America's first battery-grade cobalt refinery and will enable domestic production of batteries for up to one million electric vehicles annually, the company said.

The letter of intent, agreed to on January 27, expresses an interest and intent to work toward a final term sheet, but there is no guarantee that final agreements will be reached and funding will be provided to Electra.

LG Energy Solution will purchase up to 80% of the project's future production and buyer interest for the remainder exceeds capacity.

"By addressing domestic shortfalls and reducing reliance on China, where approximately 90% of the world's cobalt is currently refined, we are fostering a more resilient, sustainable, and self-reliant future for North America," Electra CEO Trent Mell said.

Separately, Electra said it plans to raise up to US$3.5 million in a non-brokered private placement of units priced at US$1.12 apiece. Each unit will consist of one Electra common share and one transferable common share purchase warrant entitling the holder to buy one Electra common share at US$1.40 for 18 months after the issue date.

The net proceeds will be used to advance the company's refinery project and for general corporate purposes.

At last look, the shares traded $0.12 lower at $1.12.

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