Li-Cycle Holdings Corp, a leading global lithium-ion battery resource recovery company, announced that it has entered into an agreement for a loan facility of up to $475 million with the U.S. Department of Energy (DOE). This loan, provided through the DOE’s Loan Programs Office’s Advanced Technology Vehicles Manufacturing (ATVM) program, includes up to $445 million in principal and up to $30 million in capitalized interest.
This marks the first DOE loan finalized for a lithium-ion battery materials recycling company, highlighting Li-Cycle’s significant role in strengthening the U.S. battery materials supply chain with domestically recycled critical materials.
Following comprehensive technical, market, financial, and legal due diligence by the DOE, the loan facility is set to support the development of Li-Cycle’s flagship Rochester Hub project in upstate New York.
Key features of the DOE Loan Facility are summarized below:
Rochester Hub Project Overview:
Li-Cycle expects the Rochester Hub to become North America’s first commercial hydrometallurgical resource recovery facility. The hub will serve as a significant domestic source of recycled materials for lithium-ion batteries, producing battery-grade lithium carbonate and mixed hydroxide precipitate (MHP), which contains nickel, cobalt, and manganese.
Upon full operation, the Rochester Hub is projected to annually produce up to approximately 8,250 tonnes of lithium carbonate and up to 72,000 tonnes of MHP. The facility’s processing capacity is planned at 35,000 tonnes of black mass per year. The project is anticipated to create around 825 construction jobs at peak and over 200 permanent positions.
The total capital cost for the project’s mechanical completion is estimated at approximately $960 million, with about $487 million remaining. This figure includes commitments for incurred but unpaid costs (approximately $92 million as of September 30, 2024) and excludes expenses for commissioning, ramp-up, working capital, or financing.
Li-Cycle is actively exploring financing and strategic options to secure the necessary funding to restart construction of the Rochester Hub, with the DOE loan facility being a key component. This funding will help meet the conditions for the first loan advance, including fulfilling the remaining BEC and maintaining a minimum cash balance.
Executive Commentary:
Ajay Kochhar, President and CEO of Li-Cycle, stated:
Throughout 2024, one of Li-Cycle’s primary objectives has been to finalize negotiations with the DOE in order to enter into definitive documentation to obtain a DOE loan. Today, we are excited to announce our achievement of this significant milestone, which we believe represents a strong vote of confidence in Li-Cycle’s patented and environmentally friendly recycling technology and business model. Securing the DOE Loan Facility through our close collaboration with the DOE is a critical step toward our goal of restarting construction at the Rochester Hub project.
“We believe that the DOE Loan Facility offers attractive terms relative to other third-party financing alternatives available to us. We believe it will also enhance our financial flexibility and support our mission to create a sustainable, closed-loop battery supply chain, which is vital to the electrification transition and securing energy independence in North America.”
About Li-Cycle Holdings Corp.:
Li-Cycle is a leading global lithium-ion battery resource recovery company. Founded in 2016, Li-Cycle’s mission is to recover critical battery-grade materials to establish a domestic closed-loop battery supply chain for a clean energy future. The company utilizes its innovative, sustainable, and patented Spoke & Hub Technologies™ to recycle various types of lithium-ion batteries.
At its Spoke facilities (pre-processing), Li-Cycle recycles battery manufacturing scrap and end-of-life batteries to produce black mass—a substance containing valuable metals like lithium, nickel, and cobalt. At its future Hub facilities (post-processing), the company plans to process black mass to produce critical battery-grade materials, including lithium carbonate, for the lithium-ion battery supply chain.
Source: Business Wire
