As electric vehicle businesses continue to circle BlackEarth Minerals (ASX: BEM) for battery-grade graphite resources, the Company has shored up their supply through a partnership with Luxcarbon to confirm their capability to execute a landmark supply deal to the United States EV market.
The agreement with Luxcarbon will secure BlackEarth with 25,000mt of high grade graphite, enabling them to meet supply obligations with their own offtake partner Urbix, which they entered into a Memorandum of Understanding (MOU) last week. Partnering with Luxcarbon, BlackEarth is able to fast-track the development of their processing facilities which would fulfill supply requirements detailed in their Urbix MOU.
“The Board are delighted to sign this Agreement with Luxcarbon, a leader in the graphite supply and marketing of graphite concentrate and downstream products throughout Europe,” said BlackEarth Managing Director, Tom Revy.
“This Agreement provides a number of great outcomes for BlackEarth. Firstly, it enables us to secure a supply of world class graphite concentrate that can be supplied to Urbix’s operations in the USA and also our own downstream processing facility whilst we complete the development of our plants in Australia and Madagascar.
“Secondly, Luxcarbon are leaders in the supply and understanding of downstream graphite products and this will assist us greatly.”
The 3-year agreement with Luxcarbon will give BlackEarth enough time and commercial resources to establish their own facilities which will process raw material for supply to Urbix and other customers.
It comes just one week after the Urbix MOU was announced to establish an operational joint venture, highlighting BlackEarth’s commitment to the EV market in the United States where new President Joe Biden is actively encouraging EV manufacturers to “Buy American”.
Also within their agreement with Luxcarbon, the Germany-based graphite supplier will sell up to 25,000mt pa of BEM and BEM JV produced products in what would work out as a 2-way deal. As such, it will secure BlackEarth with new access to European markets in which EV sales rose 44% in 2019 and are thriving as a result of the EU’s new emissions standard.
Luxcarbon is a major supplier of Graphite & Carbon products to Volkswagen, Mercedes, Ford.
Following news of the Luxcarbon agreement, BEM shares reached a high of $0.23 in the first hour of morning trade, a rise of 150% on their previous $0.092 close. It continues a strong rally in BEM shares which closed at $0.053 on February 1 before the Company announced their MOU with Urbix.
- Healthia earnings up 91% as pandemic boosts Aussie health consciousness - February 25, 2021
- Overcoming off-field budget cuts, Catapult analytics prove essential across pro sports - February 25, 2021
- New rides and Theme Park upgrades – Ardent Leisure poised for pandemic recovery - February 25, 2021