Glencore has entered into a strategic partnership with Li-Cycle. The mining group is investing $200 million in the Canadian battery recycling company, which will also become a preferred partner of Glencore in the lithium-ion battery recycling sector.
In addition, Li-Cycle and Glencore will establish an integrated network to supply primary and secondary lithium-ion battery materials, according to announcements from the two companies. Some sub-agreements of the strategic partnership are still to be finalised: The deals for the supply and offtake of black mass, the offtake of hub end products and by-products, and the supply of key reagents have yet to be yet to be agreed upon.
Li-Cycle’s system includes “hubs” and “spokes”. The factories called “spokes” receive the used batteries and process them into so-called black mass. In the “hubs”, the collected black mass is centrally processed into new raw materials.
Under the agreement, Glencore will supply “all types of production waste and end-of-life lithium-ion batteries” to Li-Cycle. Li-Cycle will process the material in its “spokes” and “hubs”. Glencore will then take back the battery-grade end products from the hubs – as well as unspecified by-products. In addition, Glencore will supply sulphuric acid to Li-Cycle, “one of the key input reagents for Li-Cycle’s hubs”.
The $200 million investment also gives Glencore the right to appoint a member to the board of directors. Kunal Sinha, Head of Recycling at Glencore, has been chosen. “This is an important step in building a strong long-term foundation for the vertical integration of the battery materials supply chain,” says Sinha. “Together, we will expand the range of battery materials supply solutions to a broader global customer base, particularly in Europe and North America.”
“We are thrilled to have Glencore as a long-term strategic investor and global commercial partner. Bringing our complementary capabilities together will accelerate the path to a circular economy for critical materials in the lithium-ion battery supply chain,” said Ajay Kochhar, Li-Cycle Co-Founder and Chief Executive Officer. “These agreements further secure and diversify our lithium-ion battery supply and feedstock sources, competitively positioning our network expansion in North America and Europe.”
As recently as September 2021, Li-Cycle received a US$100 million investment from Koch Strategic Platforms (KSP). In addition, Li-Cycle has entered into some key recycling agreements, such as with LGES, Arrival, NFI and Ultium Cells, the battery joint venture between GM and LG. In January, Li-Cycle also announced its first factory outside North America – the factory in Norway is scheduled to start operations in early 2023.
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