Electra Battery, LG Energy update cobalt supply deal

Executive Summary

• Electra Battery Materials Corp. and LG Energy Solution have signed a new binding term sheet updating their long-term cobalt supply agreement, reaffirming LG as a cornerstone customer for Electra's Ontario refinery.
• The updated agreement secures a firm commitment for 60% of Electra's cobalt sulphate production through 2029, with an option to extend terms through 2032, leaving 40% of capacity uncommitted for potential upside.
• The update coincides with active construction of North America's only cobalt sulphate refinery, with a $73 million U.S. construction budget approved in February 2026, targeting early commissioning in Q4 2026 and commercial production in Q4 2027.

Key Details

• Agreement Structure: New binding term sheet updating the contract period for long-term supply of battery-grade cobalt from Electra's Ontario refinery.
• Volume Commitment: Firm commitment for 60% of Electra's cobalt sulphate production through 2029.
• Uncommitted Capacity: Approximately 40% of capacity remains uncommitted to provide flexibility for Electra to capture potential upside in pricing cycles.
• Extension Option: The agreement includes an option to extend terms through to 2032.
• Pricing Context: Cobalt sulphate prices have increased over 90% since the beginning of 2025.
• Historical Context: Follows an initial three-year agreement signed in 2022 and a five-year extension announced in July 2023.
• Project Status: North America's first battery-grade cobalt sulphate refinery is under active construction.
• Construction Budget: $73 million (U.S.) approved in February 2026.
• Production Timeline:
  • Early commissioning of select circuits targeted for Q4 2026.
  • Production ramp-up through 2027.
  • Commercial production targeted for Q4 2027.
• Facility Capacity:
  • Initial production: 5,120 tonnes per annum of contained cobalt.
  • Crystallizer nameplate capacity: Up to 6,500 tonnes per annum.
• Facility Status: Fully permitted and financed brownfield facility.

Notable Quotes

• "The updated agreement underscores the strength of our long-standing partnership and LG Energy Solution's role as a cornerstone customer in Electra's vision to build a resilient, North American supply chain for critical minerals," said Trent Mell, chief executive officer of Electra Battery Materials.
• "As we advance construction of North America's only cobalt sulphate refinery, this offtake agreement reflects growing demand for secure and responsibly sourced cobalt and reinforces Electra's position as a first mover in domestic critical minerals processing. With a fully permitted and funded project now under active construction, our focus is on disciplined execution, meeting key build milestones and delivering a strategic asset that supports North America's critical minerals security priorities."