Novonix (ASX:NVX) has entered into a non-exclusive testing and development agreement with Volkswagen Group-owned battery cell company PowerCo, with a potential opportunity to enter into a supply agreement.
Shares edged up over 7% today (15 May) to an intra-day high of $0.885 before retracing some of the gains back to $0.86 at 12.30 AEST.
As part of the agreement, Novonix will develop, test, and analyse synthetic graphite anode materials tailored to meet PowerCo’s requirements.
PowerCo has identified three gigafactory locations with a total capacity of up to 200 gigawatts per year in Germany, Spain, and Canada.
If completed, the testing and development agreement could lead to future collaborations with a focus on requirements of the St Thomas facility in Canada and the aim to bolster the development of North America’s battery materials supply chain.
Novonix, which has a market capitalisation of $403.38 million, says its Riverside facility in North America has the potential to become the first “large-scale” production facility of high-performance synthetic graphite for batteries.
The company aims to start production by late 2024, scaling up to 20,000 tonnes per year to meet the drawing demand for batteries.
Novonix is also planning to expand the capacity to a total of 150,000 tonnes per year of production capacity in North America.
The US Department of Energy Office of Manufacturing and Energy Supply Chains provided Novonix with US$100 million ($150.8 million) in funding, alongside US$103 million in Qualifying Advanced Energy tax credits, which Novonix says reinforces its commitment to strengthen the local supply chain.
Novonix is a battery technology company focused on the global lithium-ion battery industry.
The Volkswagen Group is bundling global battery activities in the European company PowerCo, which is based in Salzgitter, Germany.
