Nouveau Monde Graphite Inc. expects to formally approve plans this week to build one of North America's few graphite projects, as countries seek to weaken China's dominance over the critical mineral.
A previously announced financing package of about US$645 million in gross proceeds was backed by shareholders Wednesday. The money will be used to develop a graphite mine in Saint-Michel-des-Saints, Quebec, about 100 miles north of Montreal, and to build a concentrator nearby.
Graphite is a key material in lithium-ion batteries, prized for its conductivity. China is the world's major supplier.
A construction team is already on site and more than 50% of the project's capital expenses are secured through contracts, according to a company statement. Costs are estimated at about US$474 million, and commissioning is projected by the end of 2028.
The company's plans also include a refining facility for the production of 13,000 metric tonnes per year of active anode material, which accounts for about half of an electric vehicle battery. The plant is to be built in Becancour, Que., where General Motors Co. and Rio Tinto Group-backed Nemaska Lithium Inc. are already constructing EV battery-component plants.
Nouveau Monde's ambitions have been slowed down by automakers' retreat on electric vehicles, with GM withdrawing from the project and Panasonic Holdings Corp. scaling back an offtake agreement. The expected full production at the Becancour facility has been lowered by 70% and will entirely go to Panasonic.
"I never thought the mining project wouldn't get off the ground," chief executive Eric Desaulniers said in an interview. "It is too solid and too far along — and too necessary, too."
The Canadian government stepped in last fall to provide investors with more certainty by ensuring the purchase of 30,000 metric tonnes of graphite concentrate per year, or slightly less than a third of the mine concentrator's output, at a fixed price to support the venture. The government also selected Nouveau Monde as one of the major projects to prioritize.
Export Development Canada and the Canada Infrastructure Bank committed US$335 million in debt. The Canada Growth Fund, the Quebec government and Italian energy firm Eni SpA will provide a private placement of US$213 million, which needed Nouveau Monde shareholders' approval. A bought deal public offering will bring in US$96.5 million. Mitsui & Co. is among Nouveau Monde's largest shareholders.
Eni also signed a letter of intent for a potential offtake of graphite concentrate or active anode material from the Becancour plant.
Desaulniers said the challenges tied to slower EV adoption have pushed his firm to diversify the potential customer base for graphite concentrate — including the energy storage and steelmaking industries.
