Push toward construction on cobalt refinery a Q2 highlight for Electra

Electra Battery Materials Corp., a battery recycler based in Toronto, has filed its financial results for the second quarter of this year, and reports a cash position of $3 million Canadian.

Subsequent to June 30, the company received a temporary waiver from the holders of its senior secured debt to reduce the reportable minimum liquidity balance to $1 million U.S. In connection with the waiver, the company says it has begun discussions with the debtholders and other prospective investors regarding a range of potential transactions, including the potential equitization of a portion of the outstanding debt, with a view to strengthening liquidity.

RELATED: Electra begins testing North American feedstock for cobalt refinery | Electra working toward restarting cobalt refinery construction

Electra says discussions are preliminary in nature and there can be no certainty they will result in a transaction or on what terms a transaction may occur.

“The second quarter demonstrated Electra’s continued financial discipline and focus on enhancing flexibility as we work to align our capital structure with the company’s long-term strategic goals of advancing the critical infrastructure that will help reshape the North American battery materials landscape,” says Marty Rendall, the company’s chief financial officer.

During the second quarter, Electra launched early works activities to prepare for a resumption of construction on its cobalt refinery and began metallurgical testing of domestic cobalt feedstock from its Cobalt Camp in Ontario and its Iron Creek project in Idaho. The company also reports it completed a feasibility level Class 3 engineering study for a new battery recycling facility to be built on the same site as the cobalt refinery, forming part of an integrated metallurgical complex in Ontario.

According to Electra, second quarter highlights include:

• Early works started at cobalt refinery: In June, the company launched site-level activities to support restart of construction at what it claims will be North America’s only cobalt sulfate refinery focused on advancing high-priority activities in the solvent extraction area, including installation of equipment and completion of structural work.
• North American feedstock testing: On July 31, the company began metallurgical testing of North American cobalt feedstock from two sources, its Iron Creek project in Idaho and legacy operations in Ontario’s Cobalt Camp.
• Engineering study completed: The company says the study was completed in early June for a new battery recycling refinery to be located adjacent to its existing cobalt refinery in Temiskaming Shores, Ontario. The study builds on Electra’s 2023 black mass demonstration.
• Aki joint venture advanced: Electra and its Indigenous partner, Three Fires Group, made progress on their Aki Battery Recycling joint venture, which Electra says is poised to become Canada’s first Indigenous-led lithium-ion battery recycling initiative. Key developments include shortlisting of technology partners, potential site evaluations and government engagement.

“With the global spotlight now squarely on securing domestic supply chains, governments across North America are backing efforts to reduce reliance on foreign sources of critical minerals, and Electra is preparing to answer that call,” CEO Trent Mell says. “Our permitted cobalt refinery is a brownfield asset with a proven flowsheet, strategic partnerships and most of the critical equipment already delivered to site.

“While we continue to work collaboratively with stakeholders to strengthen our capital structure, our primary focus remains on bringing this facility into production. We are also taking measured steps to advance our battery recycling platform and broaden our feedstock pipeline. Together, these efforts reinforce Electra’s leadership in building a secure, circular and low-carbon battery materials supply chain.”