US-based critical minerals midstream refining company Nth Cycle has been selected by the US Department of Energy to enter into award negotiations for up to $100-million to develop and construct a commercial-scale black mass refining facility in the south-east of the country.

The facility will be one of the first US-based commercial-scale black mass refineries - black mass is the material created from shredding spent lithium-ion batteries.

The department's Office of Critical Minerals and Energy Innovation has been advancing funding to expand US critical mineral processing and domestic battery manufacturing capacity under the Battery Materials Processing and Battery Manufacturing & Recycling grant programme.

For context, the US Department of Commerce recently issued a one-year export ban on black mass. With insufficient domestic refining capacity to match the country’s growing supply, China has held a near-monopoly on its processing.

The Nth Cycle facility, called Project Shield (Strategic Hub for Industrial Electroextraction and Logistics Defence) will strengthen domestic supply chains supported by federal initiatives and industry demand.

Using the company's proprietary electroextraction platform and OYSTER system, it will refine up to 24 000 t/y of domestic black mass to convert it into high-purity nickel mixed hydroxide precipitate (MHP) and battery-grade lithium carbonate for military systems, AI data centres, electric grid storage and transportation.

“The Trump Administration has recognised that keeping recoverable critical minerals in the US is a matter of national security. However, without refining capacity, those resources can’t be used for new manufacturing. Being selected to fill this gap validates the role we play to onshore one of the most consequential supply chains of our time," says Nth Cycle CEO and co-founder Megan O'Connor.

Nth Cycle already has a ten-year offtake term sheet in place with commodities trader Trafigura for it to purchase 2 000 t of nickel contained in MHP and 1 500 t of lithium carbonate.

Nth Cycle's new US-government-backed Project Shield facility adds to its existing operations in Ohio, which began production of high-purity nickel MHP from scrap in 2024.

Project Shield is expected to be operational in 2029, which is a short timeline assisted by Nth Cycle's modular OYSTER system that can be installed in existing industrial buildings in as little as two years and at 70% lower capital intensity than traditional refineries.