Nouveau Monde Graphite (TSX-V:NOU) (NMG) shares gained more than 25% on Thursday after the Quebec, Canada-based producer of battery anode materials announced significant off-take agreements with General Motors Company (NYSE:GM) and Panasonic Energy.
Under the initial six-year agreement with GM, NMG will supply 18,000 tons per annum of active anode material.
GM will invest US$150 million in the company in two tranches. An initial US$25 million will be invested to support the advancement of NMG’s Phase 2 operations, the Matawinie mine and the Bécancour battery material plant, in line with GM’s battery manufacturer’s specifications.
“Our collaboration with NMG is a milestone for the industry, and in our ongoing development of a more sustainable and resilient battery supply chain,” GM vice president of global purchasing and supply chain Jeff Morrison commented.
In parallel, NMG announced that it had signed an initial seven-year off-take agreement also for 18,000 tons per year of active anode material with Panasonic Energy, a wholly-owned subsidiary of Panasonic Corporation (NYSE:PC).
Panasonic Energy will also make an initial US$25 million equity investment in NMG to support its Phase 2 operations to meet its specifications, with the potential that this will be followed up with further investment in partnership with co-investors of up to US$150 million.
NMG said the two off-take agreements, totalling 36,000 tons of battery anode material per year, cover approximately 85% of its expected Phase 2 production from ore to battery materials.
Additionally, NMG announced that it has secured a further US$87.5 million aggregate combined investment from Mitsui and Pallinghurst Bond Limited.
“Today, influential actors in strategic minerals, modern commodities, batteries, and EVs are coming together to drive the establishment of a Canadian source of graphite to support energy autonomy, national security, and global decarbonization,” NMG chair Arne Frandsen said in a statement.
“I am confident that such commercial and investment levers will constitute the bedrock on which NMG can build its Phase 2 operations and more.”
NMG's US-listed shares traded 25.1% higher at US$2.61 in the early afternoon on Thursday.