First Phosphate Corp. (CSE:PHOS) announced that it has finalized a joint lithium iron phosphate (LFP) homologation agreement and LFP production technology licensing agreement with UK-based Integrals Power Limited.
The company said the agreement, which was entered into on January 10 before becoming effective on March 24, could serve to anchor its future LFP cathode active material production facilities. It is currently of unknown potential future monetary value, it added.
"We have visited the IPL facilities in the United Kingdom and were able to see and touch the LFP cathode active material produced by IPL," First Phosphate CEO John Passalacqua said in a statement. "We have also viewed the performance logs of test battery cells created using LFP cathode active material produced by IPL. We are cautiously optimistic that IPL technology could hold the answer to improved LFP battery performance.”
The agreement provides for the following mutually beneficial, perpetual arrangements between the parties:
- IPL will validate First Phosphate LFP-grade purified phosphoric acid and iron sulphate for use in LFP battery cells;
- IPLs LFP cathode active material homologation process will use First Phosphate LFP-grade purified phosphoric acid and iron sulphate;
- IPL provides an LFP production technology license to First Phosphate in the production of LFP cathode active material at any First Phosphate LFP cathode active material production facilities to be built in Quebec, Canada or elsewhere in North America. A royalty fee of 1.5% will apply to all LFP cathode active material sales;
- First Phosphate has acquired 7,386 common shares of IPL for a cost of C$83,060.35 and has the right to make follow-on investments in future funding rounds; and
- First Phosphate and IPL plan to leverage First Phosphate's access to green hydroelectric energy in the Saguenay-Lac-St-Jean region of Quebec for optionality in the build-out of IPL's future production facilities.
"There is the traditional solid-state method of making LFP cathode active material from ferro-phosphate and lithium-phosphate precursors which is currently the main production formula used in China. Then there are promising new advanced hydrothermal methods such as those being pioneered by IPL that produce higher performance LFP batteries," First Phosphate President Peter Kent added. "We believe it prudent for the company to have access to IPL's advanced method of LFP cathode active material formulation.”
First Phosphate noted that IPL technology demonstrates improvements that should allow for the production of LFP batteries that will have more simplified cooling systems, greater compactness, lighter footprint and lower pre-heating requirements in colder temperatures.
Some of the benefits include:
- Increased capacity at high discharge rates;
- High capacity retention within an ambient and extreme environmental temperature; and
- Lower cost or higher capacity.
The company said it was informed that IPL recently closed its oversubscribed equity investment round which received co-investment by the UK government grant-funded project for LFP battery material pilot plant development. The IPL pilot plant is expected to be operational by the end of 2023.
"We are pleased to partner with First Phosphate in gaining strategic access to properly curated LFP-grade purified phosphoric acid and iron sulphate which will be in short supply in the near future as LFP production comes online in the Western World," IPL CEO Behnam Hormozi commented. "We require a development partner like First Phosphate which is fully committed to the LFP battery industry, to a low carbon footprint, to ESG compliancy, to non-conflict ethical sourcing, to traceable and secure supply and to just-in-time provisioning. All of these are strategic production advantages for IPL and our clients.”
First Phosphate has a measured and phased development approach to becoming a fully vertically-integrated producer of LFP cathode active material in North America. The company can undertake this strategy because it has access to clean igneous anorthosite phosphate-bearing rock in Quebec, Canada that it will be able to purify into large quantities of battery-grade purified phosphoric acid. Today's agreement with IPL allows First Phosphate to gain another important technological advantage in the production of LFP cathode active material for North America.
Contact the author at stephen.gunnion@proactiveinvestors.com