Graphite One Inc. (TSX-V: GPH) (OTCQX: GPHOF) has announced a non-binding supply agreement with Lucid Group Inc. (NASDAQ: LCID) to provide anode active materials (AAM). This collaboration is a significant step forward for Graphite One, offering heightened credibility and assurance through its association with a prominent electric vehicle (EV) manufacturer.
Lucid Motors, renowned for its advanced electric vehicles, has partnered with Graphite One to secure a domestic supply chain for critical raw materials. This agreement is the first of its kind between a U.S. graphite developer and a U.S. EV company, marking a historic milestone in the industry.
Peter Rawlinson, CEO and CTO of Lucid, emphasized the importance of this collaboration by stating, "We are committed to accelerating the transition to sustainable vehicles and the development of a robust domestic supply chain ensures the United States, and Lucid, will maintain technology leadership in this global race. Through work with partners like Graphite One, we will have access to American-sourced critical raw materials, helping power our award-winning vehicles made with pride in Arizona."
Anthony Huston, President and CEO of Graphite One, shared similar sentiments: "This is a historic moment for Graphite One, Lucid, and North America: the first synthetic graphite Supply Agreement between a U.S. graphite developer and U.S. EV company. G1 is excited to continue pushing forward developing our 100% U.S. domestic supply chain. We appreciate the support from our investors and the grant from the Department of Defense."
The agreement comes on the heels of Graphite One's selection of a site for its proposed AAM facility in Warren, Ohio. This location, previously used by the U.S. Government to stockpile National Defense critical minerals, is strategically situated in the automobile industry hub and offers low-cost renewable energy sources. The existing power infrastructure supports Graphite One's initial production target of 25,000 tonnes per year of battery-ready anode material, with plans to expand to 100,000 tonnes annually.
The terms of the non-binding agreement outline the provision of 5,000 tonnes per annum of anode material to Lucid once production commences. The initial term spans five years, with an option for early termination, and sales will be based on a price formula linked to future market pricing and agreed base case pricing.
Graphite One's comprehensive strategy aims to address the U.S.'s current dependence on imported synthetic and natural graphite. Anchored by the Graphite Creek deposit, the largest in the U.S., the company plans to establish a fully domestic graphite supply chain. This includes mining, processing, manufacturing, and recycling operations, all designed to support the U.S. EV battery market and energy storage systems.
The company has already secured significant backing from the U.S. Government, including a $37.5 million grant for its feasibility study and a $4.7 million contract to develop a graphite-based foam fire suppressant. These initiatives underscore the strategic importance of reducing reliance on foreign sources of graphite and fostering a self-sufficient, sustainable supply chain within the U.S.
Graphite One's forward-thinking approach is poised to meet the growing demands of electrification and sustainable development. By establishing a secure, high-quality supply of graphite materials, the company aims to catalyze technological advancements and support the next generation of EVs and energy storage solutions.
