Electra Provides Update on Refinery Project and Black Mass Economics; Launches Strategic Review Process - Seite 2

Black Mass Economics

Electra launched a black mass trial late in 2022 at its Ontario refinery complex to recover high-value elements found in shredded lithium-ion batteries. Using its proprietary hydrometallurgical process, Electra successfully completed the first plant-scale recycling of black mass material in North America and confirmed the recovery of a number of critical metals, including lithium, nickel, cobalt, copper, manganese, and graphite, needed for North America’s EV battery supply chain, surpassing initial expectations.

To date, Electra has produced quality nickel-cobalt mixed hydroxide, graphite, and lithium carbonate products in its black mass recycling trial. The Company expects to begin commercial shipments of product to customers in Q2 2023.

Electra completed an desktop scoping study to evaluate the potential economics of developing a standalone black mass process plant within its refinery complex capable of processing 2,500 tonnes of black mass material per annum. The Phase 1 facility could be scaled over time as the market for battery recycling expands.

Highlights from Electra’s desktop scoping study include:

• Capital spend is estimated at approximately US$6 million.
• The internal rate of return is estimated at 127%.
• EBITDA is estimated to be in the range of US$9.6 to US$12.6 million per year beginning in the first full year of operations.
• The payback period is estimated at between 1 and 2 years.

Electra’s desktop scoping study was based on a number of assumptions, including annual processing of 2,500 tonnes of black mass, metal prices using analysts’ long-term forecasts, recovery rates consistent with those achieved to date, and US$9.2 million of committed capital comprised of US$5.9 million for capital costs and US$3.3 million in working capital.

At this time, black mass recycling capabilities remain at the evaluation stage and the decision to commercialize these capabilities remains subject to financing and additional engineering work to incorporate process modifications arising from the demonstration plant and the successful evaluation of samples by customers. Subject to these two conditions, expansion to 2,500 tonnes per annum could occur in 2024 pending the securing of financing for the project and installation of additional vessels and equipment within the existing footprint of the refinery complex being utilized for the black mass trial.