Volkswagen and PowerCo strategically invest in North American lithium company Metals

     PowerCo SE, the battery division of the Volkswagen Group, has formed a strategic alliance with Metallica. This marks PowerCo and Volkswagen's first investment in the lithium supply chain, underscoring PowerCo's goal to implement its vertically integrated strategy from extraction to battery production. The collaboration ensures the continued supply of lithium raw materials through a guaranteed off-take agreement. The two companies will work together on other strategic prospects, including a downstream lithium supply chain that emphasizes cost competitiveness, improved ESG standards, and long-term security.

     Volkswagen Group invested $48 million to acquire 9.9% of the issued and outstanding ordinary shares of Aigo. Upon commencement of production at the Shaakichiuwaanaan project, binding underwriting commitments will guarantee an annual supply of 100,000 tonnes of spodumene concentrate for 10 years. This lithium-containing mineral is crucial for the production of battery-grade lithium chemicals. The acquisition is a key strategic milestone in PowerCo's expansion of battery production activities in Europe and North America, including its Gigafactory in St. Thomas, Canada. PowerCo's largest battery plant, St. Thomas, will have a capacity of 90gwh.

     This strategic partnership also includes ongoing assistance for the advancement of Patriot's Shaakichiuwaanaan lithium project. Currently, the project is making significant progress and is one of the largest lithium pegmatite resources in the Americas and the eighth largest worldwide. PowerCo's battery facilities have the potential to benefit from the long-term safety of high-grade deposits.

     In addition, the strategic partnership requires the collaboration of PowerCo and Patriot to establish industry best practices for ESG standards across all of their joint activities. This includes, among other things, implementing measures to meet PowerCo and Patriot's carbon emissions targets, as well as water and waste management, and the involvement of First Nations communities. In addition, under a non-binding, non-exclusive memorandum of Understanding, the parties will explore opportunities for collaboration to establish a sustainable, cost-competitive, ESG-compliant battery grade lithium compound supply chain model.