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Electra Battery Materials (NASDAQ: ELBM; TSX-V: ELBM) said Tuesday it has signed a term sheet with global commodities trader WMC Group AG for a five-year working-capital and commercial partnership supporting its critical minerals refinery in northern Ontario.
The arrangement will finance cobalt feedstock purchases and corresponding battery grade cobalt sales, strengthening the efficiency of the refinery’s operating cash cycle, the company said.
Electra last year launched an early works program, signaling a restart of North America’s first and only cobalt sulfate refinery, located in the town of Temiskaming Shores.
The early works program encompasses targeted site-level activities designed to prepare for the restart of full-scale construction. The initiative is supported by strategic funding from both the US and Canadian governments.
The partnership provides logistics management, cobalt market expertise, marketing support and access to WMC’s global commercial network as Electra transitions from construction and commissioning into operations.
“As Electra gets closer to production, the relationship provides the inventory working capital and provides our commercial team with broader access to cobalt buyers around the world,” Electra CEO Trent Mell said in a news release.
“This agreement addresses our priorities around working capital, logistics and product qualification. WMC markets physical commodities worldwide, combining market intelligence and long-standing customer relationships,” Mell said. “Those capabilities complement our existing commercial relationships and can help us optimize the refinery as we ramp toward full production.”
In addition to providing finance and logistics services for volumes up to the refinery’s nameplate capacity, WMC will act as buyer and exclusive marketing agent for corresponding cobalt sulfate production.
At market close in Toronto, Electra’s stock was down 4.7%. The company has a C$73.8 million ($51.9 million) market capitalization.