PERTH (miningweekly.com) – Global automaker Stellantis has completed its first $15-million investment in ASX-listed Element 25, following the offtake and project financing agreement announced in January.
Under the terms of the agreement, Element 25 will supply up to 10 000 t/y of battery-grade high-purity manganese sulphate (HPMSM) to Stellantis for its electric vehicle (EV) battery requirements, for a period of five years, with the provision to extend the supply agreement and to increase volumes.
The agreement combines take or pay offtake commitments for 45 000 t of HPMSM from Element 25’s proposed US-based processing facility, which Stellantis is to part-fund with a $30-million investment in two tranches.
The first $15-million in funding was provided by way of a share subscription agreement, priced at A$1 a share, with Element 25 saying on Tuesday that the company had issued more than 22.56-million shares to Stellantis.
The company will use the proceeds from the share placement for planned engineering and construction activities to advance its proposed US-based HPMSM processing facility in Louisiana.
A further $15-million will be structured as a prepayment agreement which will be repaid out of HPMSM supplied under the offtake agreement to Stellantis over the five-year period, on commercial terms.
Element 25 is hoping to start HPMSM supply to Stellantis in 2026, with 5 000 t of HPMSM targeted in the first year of operations, increasing to 10 000 t/y in years two to five.
Element 25 told shareholders on Tuesday that the first investment from Stellantis, along with the recently announced $85-million financing facility secured from General Motors, took project commitments from EV manufacturers to $115-million.