Glencore Li-Cycle Partnership Focuses on Sustainable Battery Recycling

Glencore's partnership with Li-Cycle is a significant step towards sustainable battery recycling. Li-Cycle is a leading lithium-ion battery recycling company.

The partnership aims to build a new lithium-ion battery recycling facility in Ontario, Canada. This facility will be designed to process up to 100,000 tons of lithium-ion batteries per year.

Glencore and Li-Cycle are working together to develop a closed-loop recycling system that will recover high-purity lithium, nickel, cobalt, and graphite from spent lithium-ion batteries. This will reduce waste and the demand for primary materials.

The new facility will create over 300 jobs in Ontario and will be a major contributor to the region's economy.

Glencore invested $200-million for a 10-per-cent stake in Li-Cycle last year.

This investment is a significant step in Glencore's ambition to become the circularity partner of choice for the European battery and electric vehicle industry.

Glencore's recycling chief, Kunal Sinha, said the project combined with their existing footprint in primary supply as well as recycling of battery metals underpins their ambition.

The partnership will make Li-Cycle and Glencore key players in the European race to control the critical metals needed for the green revolution.

Glencore's mines in the Democratic Republic of Congo produce some 20 per cent of the global supply of cobalt.

Glencore's Horne smelter in northern Quebec is North America's largest recycler of metals, such as copper, that are removed from electronic scrap.

The new Sardinia plant would be commissioned by early 2027 and would have the capacity to process 50,000 to 70,000 tons a year of black mass.

Li-Cycle would provide the engineering know-how to get the Sardinia site running.

Glencore has committed to responsible growth, pledging not to acquire beneficial ownership of additional common shares of Li-Cycle above 5% without approval from a committee of disinterested directors and shareholders.

This commitment is part of Glencore's strategy to bring scalable and sustainable circularity into the supply chain of battery materials. Kunal Sinha, Glencore's global head of recycling and non-executive director of Li-Cycle's Board of Directors, emphasized this goal in a March 12 announcement.

Glencore's investment in Li-Cycle is expected to enhance the company's financial viability, which is crucial given the delay associated with obtaining a shareholder vote. The Audit Committee of Li-Cycle's Board of Directors determined that this delay would seriously jeopardize the company's financial viability.

Li-Cycle received confirmation from the NYSE on March 1 that they would not object to the company's reliance on the financial viability exception. This exception allows Li-Cycle to proceed with the investment without shareholder approval.

Li-Cycle and Glencore are planning to build Europe's biggest battery recycling plant in Sardinia, Italy.

The plant will be built on the old Portovesme site that Glencore uses to smelt lead and zinc, and will have the capacity to process 50,000 to 70,000 tons a year of black mass.

This project is a key part of Li-Cycle's European expansion, which aims to establish the company as a major player in the European battery recycling industry.

Glencore has invested $200 million in Li-Cycle, and the two companies are working together to develop a European recycling hub.

Li-Cycle has predicted that about 10% of Europe's lithium demand will come from recycling by 2030, and the European Union is implementing rules to ensure that 10% to 20% of key metals used in EV production come from recycled supplies.

The new plant is expected to be commissioned by early 2027, around the time when the first generation of EVs will go to recycling sites.

The precise ownership of the Sardinia plant is yet to be determined, although Glencore is likely to emerge as the majority owner after financing Li-Cycle's share of the project.

The project is expected to be a landmark for Europe's battery recycling industry, and will provide a significant source of recycled battery-grade lithium on the continent.