Volkswagen Group, PowerCo and Canadian lithium company Patriot Battery Metals form a strategic partnership to secure the long-term supply of lithium raw materials from North America.
This is the first investment for PowerCo and Volkswagen in the lithium supply chain, underlining PowerCo’s ambition to execute on its vertical integration strategy – from mine to battery. The partnership ensures the long-term supply of lithium raw materials through a binding offtake commitment. Additionally, the companies will jointly explore further strategic opportunities such as a downstream lithium supply chain with a focus on cost competitiveness, high ESG standards and long-term security.
The Volkswagen Group invests US$48 million to acquire 9.9 per cent of Patriot’s issued and outstanding common shares. The binding offtake commitment covers the supply of 100,000 tonnes of spodumene concentrate per year for a period of 10 years as soon as the Shaakichiuwaanaan Project starts production. The lithium-bearing mineral is key for the production of battery-grade lithium chemicals.
The offtake represents a key strategic milestone in ramping-up PowerCo’s cell production activities in Europe and North America, including its gigafactory in St. Thomas, Canada. St.Thomas will be PowerCo’s largest cell factory with a capacity of up to 90 GWh.
The strategic partnership also includes ongoing support for the development of Patriot’s Shaakichiuwaanaan Lithium Project. The project is advancing rapidly and currently ranks as one of the largest lithium pegmatite resources in the Americas, and the eighth largest lithium pegmatite resource in the world. The high-grade deposit has the potential to provide long-term security to PowerCo’s battery cell factories.
Furthermore, the strategic partnership involves PowerCo and Patriot working together to establish industry best practice for ESG standards across all of their joint activities. This includes, for example, waste disposal measures, water management, First Nations community engagement and implementing actions to meet PowerCo’s and Patriot’s carbon emission targets.
On the basis of a non-binding, non-exclusive Memorandum of Understanding, both companies will additionally explore collaboration opportunities to establish a sustainable, cost-competitive and ESG- compliant battery-grade lithium chemicals supply chain model.
