INTERVIEW: Nouveau Monde adds recycling to sustainable graphite project

By Jon Stibbs
Published: Monday, 14 June 2021

Canada-based Nouveau Monde plans to recycle its active anode graphite flake while developing its sustainable graphite project, company founder Eric Desaulniers has told Fastmarkets.

Nouveau Monde has set up a partnership with lithium-ion battery recycling company Lithion Recycling, also based in Canada, to reclaim the graphite that would normally be unusable when battery anode materials are recycled.

"Graphite is usually lost in the process of recycling nickel and cobalt from batteries, and used as a combustible in the standard pyrometallurgical process," Desaulniers told Fastmarkets on Thursday June 10. "However, Lithion will be able to extract used graphite efficiently thanks to its patented hydrometallurgical recycling process."

Nouveau Monde Desaulnier believes that Nouveau Monde will have an advantage through its use of a thermal purification process.

The material to be recycled will come from Nouveau Monde’s own anode material plants.

The company plans to commission its coated spherical purified graphite facility, which is based on thermal purification processing, in the first quarter of 2022, the company said on June 8.

"We expect that the recycled graphite will be already in a somewhat valuable spheronized shape to 15-20 microns," Desaulniers said. "But the graphite will be damaged a little, with an SEI [solid electrolyte interface] layer on it that will need to be removed. It needs to be reshaped, repurified and recoated."

SEI is a cover on active anode graphite that dictates the functionality of the material.

"The purpose of the Lithion and Nouveau Monde agreement is to find out how to optimize the value chain together, and to most efficiently reintroduce this valuable graphite into our anode-material-making process," Desaulniers said.

Nouveau Monde believes that it will have an advantage over competitors which may also want to recycle their graphite, due to its use of a thermal purification process.

"It is difficult to know whether other primary graphite producers will be able to follow in our footsteps," Desaulniers said. "It will be a challenge for other producers to do this using other purification technologies, such as HF [hydrofluoric acid] leach processing. We expect that it will really need a thermal purification process."

Nouveau Monde expects that this advantage over the more widely adopted HF process will be seen when production is increased.

"We looked into HF processing and the costs escalate with the risks when ramping-up production," Desaulniers said. "We also have a big advantage over other vertically integrated graphite companies looking to produce active anode material, such as Syrah Resources, because we have all of our business in the same area."

Nouveau Monde’s downstream spherical graphite project will draw its feedstock from the company’s Matawinie graphite flake project in Quebec, Canada.

Construction has already begun at Matawinie, where the company has the right to build a mine with capacity for 100,000 tonnes per year.

Meanwhile, Australia-based Syrah Resources has its Balama flake project in Mozambique and active anode material facilities at Vidalia, in the US state of Georgia.

Despite the graphite flake capacity coming onto the market, already available or being held back following oversupply in 2019 and 2020, Nouveau Monde expects that production from its Matawinie project will not be enough to satisfy the expected growth in demand.

"Even with our 100,000-tpy capacity mine, there is not enough to meet the demand we expect. So we need to prolong the lifetime of our mine," Desaulniers said.

Graphite consumption in passenger electric vehicles will rise to 1.32 million tonnes in 2031, from 160,000 tonnes in 2021, according to the International Energy Agency. So there is increasing demand for sustainable production of graphite and other materials that make up anodes.

"We need to innovate. Our customers in Europe, in particular, have recycling goals for their battery materials and we have the perfect ecosystem to provide that," Desaulniers said. "We will sell our material, then take it back and recycle it."

At this stage, it is unclear how many times graphite can be recycled and reused under the agreement worked out between Nouveau Monde and Lithion.

"Assuming the graphite meets the specifications and performance to be anode grade, there is no reason why it should not be recycled again and again," Desaulniers said.

Flake output

Material output from Matawinie will be diversified from fine to jumbo flake sizes.

"Of our 100,000 tpy, we expect 40,000 tpy will be large and jumbo, which will be sold on the spot market and in offtake agreements, such as with Traxys," Desaulniers said.

Fastmarkets’ latest prices assessment for graphite flake, 94% C, +80 mesh, cif Europe, was $1,100 per tonne on June 10. The price was only $100 per tonne higher than at the start of this year.

The price has been stable since May 22 with support from high freight rates and despite increasing production in Madagascar.

Large flake graphite has various uses including in the production of expandable graphite.

"We are already selling our flakes to customers who are active in this market, producing foils and polymers, and it isn’t our intention to compete with them in this niche market," Desaulniers said.

But Nouveau Monde has looked into producing expandable graphite from its own feedstock.

"We have done some very interesting tests in this area and our specific flake concentrate is expanding very well," Desaulniers said.

The remaining 60,000 tpy of Nouveau Monde’s graphite flake production will be medium-sized and fines, which the company plans to use in its own downstream projects.

Fastmarkets’ price assessment for graphite flake, 94% C, +100 mesh, cif Europe, was $930 per tonne on June 10, stable since May 13.

The corresponding assessment for graphite flake, 94% C, -100 mesh, cif Europe, was $605 per tonne on June 10, stable since April 15.

Both markets have been in relative balance in recent weeks, caught between increasing supply and high costs.

ESG focus

Environmental, social and corporate governance (ESG) policies have become increasingly important in the graphite sector, especially for those companies facing the anode market.

Nouveau Monde believes that its own adoption of ESG policies means that it can demand higher prices for its material.

"Our high ESG standard means that we can already command a premium for our products in the European market, and this is also increasingly the case in the United States," Desaulniers said.

The company already offsets all of its own carbon emissions.

"Our ultimate goal is to be able to offer a fully Scope 3 carbon-neutral product delivered at the port of Montreal and, should our customers request it, an option for a fully compensated carbon-neutral solution delivered at a premium to their battery plants," Desaulniers said.

Scope 3 is the highest standard of emission standards measured under the international accounting tool, the Greenhouse Gas Protocol.

"Additionally, we are developing our all-electric mine concept. And the company we are working with will be using our mine to showcase its fleet to the world," Desaulniers said.

The adoption of ESG policies is increasingly important among the investment community.

"Investors are keen to be part of the decarbonizing economy. This is especially the case in the US and that’s why we are proud to be listed on the New York Stock Exchange [NYSE]," Desaulniers said. "We have environmentalists investing in our open-pit mine. if you can imagine that."

Nouveau Monde listed on the NYSE in May in addition to its existing listing on the TSX Venture Exchange in Toronto.

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