Biden hands $243m to WA mining minnow Element 25 Brad ThompsonReporter
Sep 20, 2024 – 7.01pm
The Biden administration has gifted $US166 million ($243.6 million) to tiny ASX-listed manganese producer Element 25 to partially fund the development of a Louisiana plant that will refine the metal into a battery-grade product.
Element 25’s windfall was revealed ahead of a meeting between US President Joe Biden and Australian Prime Minister Anthony Albanese in Delaware.
They were expected to discuss the supply and processing of critical minerals such as manganese in an effort to break China’s stranglehold on materials essential in batteries and applications like defence and decarbonisation.
Prime Minister Anthony Albanese has arrived in Delaware for the Quad summit.
Australia has taken a harder line on Chinese investment in critical minerals, including forcing the divestment of stakes associated with Chinese interests in ASX-listed rare earths play Northern Minerals.
The US Department of Energy announced Element 25’s grant late on Friday AEST. Element 25, which has a $50 million market cap, was halted from trading.
The grant will advance funding of a high-purity manganese sulphate monohydrate plant Element 25 plans to build near Baton Rouge, Louisiana. Manganese sulphate is a key component in lithium-ion battery cathodes but most of the supply in its refined form comes from China. The manganese ore will be sourced from Element 25’s Butcherbird mine in Western Australia.
It taps into a pool of $US3 billion made available to the Department of Energy by the Biden administration to ensure that the US has a viable battery material-processing industry.
The US grant is on top of loans secured from car makers General Motors and Stellantis worth $US115 million.
Detroit-based General Motors last year agreed to lend $US85 million to Element 25 and signed an offtake deal for the annual supply of 32,500 tonnes of manganese sulphate over seven years.
Stellantis, the maker of 14 car brands including Chrysler, Jeep and Maserati, has a take-or-pay offtake commitment for 45,000 tonnes annually over five years and has contributed $US30 million in funding.
Element 25 chief executive Justin Brown said the company would borrow to finance the remainder of about $US300 million required for the Louisiana plant which it expects to finish by the end of 2026.
“This is a big step for us and it’s going to help the US develop that critical minerals security that they’re looking for,” he said. “Australia has been building that relationship as well at the federal government level, and we’re happy to play a part in that.”
Separately, Element 25 is seeking funding to expand the Butcherbird mine in WA’s Pilbara region to the point where it can produce up to 1.1 million tonnes a year of manganese ore.
It has paused mining at Butcherbird for the time being, but Mr Brown said it could restart operations in light of storm damage that has curbed supply of manganese from the Groote Eylandt operations off the Northern Territory that are owned by South32 and Anglo American.
Mr Brown said Element 25’s strategy was to sell manganese into the traditional steel-making market while diverting some to Louisiana for conversion into manganese sulphate, the pale pink powder form used in cathode manufacturing.
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