Neometals Ltd.: Battery Recycling ‘Hub’ Engineering Cost Study Results

Highlights

-       Successful completion of the Engineering Cost Study (“ECS”) for the hydrometallurgical refinery (‘Hub’) section of a 21,000tpa (~50tpd) Primobius lithium-ion battery (“LiB”) recycling facility;

-       The Hub refines “Black Mass”[i] produced from Primobius’ shredding (‘Spoke’) plant, producing crystalline nickel, cobalt and lithium products, amongst others, for use in making new LiBs;

-       Hub ECS total capital costs of €274M (including 15% contingency) and annual operating cost of €56M have been estimated to +/-25% accuracy;

-       Fully integrated Spoke[ii] and Hub capital cost are estimated at €377M[iii], with annual operating costs estimated at €83M3 or €3,9733 per tonne of LiB fed into the Spoke per annum;

-       Lithium product is the largest revenue stream and expected to be lowest cost quartile; and

-       Hub ECS completion allows Primobius to demonstrate the economics of its integrated LiB recycling plant packages to existing customers, partners and new customers.

Emerging sustainable battery materials producer, Neometals Ltd (ASX: NMT AIM: NMT) (“” or “the Company”) is pleased to announce the successful completion by Primobius GmbH (“Primobius”) of the ECS for the Hub part (component) of a 21,000 tonnes per annum (“tpa”) fully integrated LiB recycling plant. Primobius is the joint venture company owned 50:50 by Neometals and SMS group GmbH  (“SMS”)[iv] that is commercialising proprietary LiB recycling technology originally developed by Neometals (“Recycling Technology”).

The Hub is designed to process 12,000tpa of concentrate comprised of the anode and cathode materials (“Black Mass”) arising from the processing of 21,000tpa of LiB modules and cells in the Spoke. The Hub can process cells and modules in multiple formats (i.e. pouches, prismatics and cylindricals) and cathode chemistries (NMC, NCA and LCO) from electric vehicle and consumer electronic batteries.

The Hub ECS is based on data from eight trials at Primobius’ Hilchenbach demonstration plant.  It also draws on information gained from detailed engineering and design work completed to date for the Mercedes Benz integrated Spoke and Hub project[v].  The Hub design produces 9,300tpa of hydrated nickel sulphate, 4,300tpa of hydrated cobalt sulphate and 1,600tpa of lithium fluoride (LiB electrolyte feedstock) and a range of other metal and chemical by-products from a LiB feed with NMC622 chemistry. It can process NMC 111 to 811 and LCO LiBs. Lithium is the largest estimated revenue source and net of nickel and cobalt co-product revenue is expected to be lowest cost quartile.

SMS completed the mechanical plant and equipment package capital expenditure estimates (“CapEx”) and provided erection/installation cost estimates for the Hub ECS with other appropriately qualified and experienced engineering companies providing the Balance of Plant and Non-Process Infrastructure (“NPI”) CapEx, all to a level of +/-25% accuracy. Table 1 sets out Key Hub ECS Metrics. Further details, including assumptions are set out later in this announcement.

The entire press release is available under the following link: https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02693032-6A1161442?access_token=83ff96335c2d45a094df02a206a39ff4

Economic Snapshot

Table 2 and Figure 1 below illustrate the strong cash generation potential of Primobius’ Recycling Technology. They show that revenue is well in excess of Operating Cost Estimates (“OpEx”) for both Spoke and for the integrated Spoke and Hub. Lithium comprises over 50% of the total revenue.

Table 2: Revenue by Recovered Elements in 1 Tonne of Spoke Feed – Data

Figure 1: Revenue by Recovered Elements in 1 Tonne of Spoke Feed - Graph

The entire press release is available under the following link: https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02693032-6A1161442?access_token=83ff96335c2d45a094df02a206a39ff4

Authorised on behalf of Neometals by Christopher Reed, Managing Director.

ENDS

For further information, please contact:

Chris Reed

Managing Director

T +61 8 9322 1182

E [email protected]

Jeremy McManus

General Manager, Commercial and IR

T +61 8 9322 1182

E [email protected]

About Neometals Ltd

Neometals is an emerging, sustainable battery materials producer. The Company is commercialising three environmentally-friendly processing technologies that will primarily produce lithium, nickel, cobalt and vanadium at lowest quartile costs with minimal carbon footprint.

Neometals’ and its partners have been recognised internationally for sustainable approaches that combine industry leading costs with circular economic principles, reducing the reliance on traditional upstream mining-based supply chains. The Company’s three core business units are commercialising these proprietary technologies in incorporated joint ventures:

-          Lithium-ion Battery (“LIB”) Recycling (50% technology) – providing recycling as a service, plant supply under JV, or technology licensing business models via Primobius GmbH (NMT 50% equity). All plants built by Primobius’ co-owner (SMS group 50% equity), a 150-year old German plant builder with 14,000 employees.

-          Primobius is recycling technology partner and plant supplier to Mercedes-Benz. Commercial 10tpd shredding ‘Spoke’ facility operational in Germany and investment decision for Primobius’ first commercial 50tpd plant with Stelco in Canada expected Q4 (NMT 25% equity).

-          Vanadium Recovery (100% technology) – aiming to produce high-purity vanadium pentoxide from processing of steelmaking by-product (“Slag”). Planned 9,000tpa operation in Pori, Finland (NMT 72.5% equity) courtesy of 10-year Slag supply agreement with SSAB. Investment decision with JV partner, Critical Metals, expected Q3 2023. MOU with H2Green Steel for potential second, larger operation in Boden, Sweden; and

-          Lithium Chemicals (70% technology) – aiming to produce battery quality lithium hydroxide from brine and/or hard-rock feedstocks using patented ELi™ electrolysis process co-owned 30% by Mineral Resources Ltd. Co-funded Pilot Plant trials Q2/Q3 2023 and Demonstration Plant trial H1 2024 preceding potential commercial operation with Bondalti Chemicals in Portugal.

[i] “Black Mass” is recovered cathode active material (nickel, cobalt, manganese and lithium) and anode material (graphite) contained within LiBs

[ii] For full details refer to Neometals ASX announcement titled “Primobius – 50tpd Spoke Engineering Cost Study Results” released 13 September 2022.

[iii] German 12-month inflation: 6.4% (Source: DEstatis, https://www.destatis.de/EN/Themes/Economy/Prices/Consumer-Price-Index/_node.html)

[iv] For full details refer to Neometals ASX announcement titled “Neometals and SMS group Create JV to Recycle Lithium-Ion Batteries” released 31 July 2020.

[v] For full details refer to Neometals ASX announcement titled “Cooperation Agreement with Mercedes-Benz” released on 13 May 2022.