Neometals proposed lithium-ion battery recycling plant could net $1.2b

A scoping study on a proposed new lithium-ion battery recycling plant could potentially generate $1.2 billion in revenue over 10 years for Perth-based Neometals (ASX: NMT) if the technology is given the green light.

The lithium company today reported robust economic outcomes from the study on its lithium-ion battery recycling process currently being demonstrated at a purpose-built pilot plant in Ontario, Canada.

The plant was built within world-class facilities owned by Canadian metallurgical and process design company SGS Lakefield.

Conducted by engineering group Primero, the scoping study determined operating scenarios for the proprietary recycling process based on Neometals’ bench scale test work and on an associated mass-energy balance model prepared by mineral processing consultant Strategic Metallurgy.

The outcomes support Neometals’ strategy to target the growing need for sustainable recycling solutions as the global adoption of lithium-ion batteries continues to grow.

Neometals is working towards commercialisation of its proprietary process for recovering critical materials such as cobalt, nickel, lithium, copper, iron, aluminium and manganese from spent lithium batteries and turning them into saleable products.

Reducing production scrap

Neometals’ managing director Chris Reed said the potentially robust economic margins of the scoping study illustrate the efficacy of the recycling process at a time when governments are looking at ways to reduce production scrap from a growing industry.

“Governments worldwide are legislating [for] compulsory lithium battery recycling to remove spent batteries from landfills and responsibly recover the majority of their constituents, creating an ethical and sustainable supply chain,” he said.

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“We have invested in a true ‘recycling’ solution rather than base metal recovery process – it has been engineered for real world conditions and recovers multiple high‐purity chemical products from an array of battery chemistries.”

Mr Reed said Primero will continue to assist Neometals with metallurgical design, flowsheet development and pilot plant supervision and management.

Historical studies

The scoping study followed an evaluation in early 2017 of cobalt recovery from consumer electronics batteries, which are typically based on lithium cobalt oxide cathode chemistries.

Since then, the forecast consensus on lithium-ion battery production growth has trended away from lithium-cobalt oxide and towards nickel‐manganese‐cobalt cathode chemistries for electric vehicles and stationary storage applications.

Based on the evaluation, Neometals adjusted its approach and designed a completely new recycling process with flexibility to process both battery types and recover embedded high‐purity chemicals with minimal impact on the local ecosystem.

Data and learnings from its Ontario pilot plant operations will be incorporated into a comprehensive feasibility study to estimate the cost of building and operating a commercial‐scale recycling plant.

The study is planned to commence early in the 2019/20 financial year.

Market opportunities

The growing need for a universal lithium-ion battery recycling solution has allowed Neometals to participate at several levels in the market.

The company said its revenue model could reap potential earnings from parties seeking a disposal and recycling service, including electric vehicle and consumer electronics makers or the companies which produce the batteries to power these devices.

Also being targeted are lithium-ion collectors and aggregators involved in battery product stewardship programs which do not have the means to process or transport spent batteries.

This could include a range of transfer stations and scrap merchants responsible for collecting, sorting and overseeing lithium-ion battery logistics for reprocessing.

At mid-afternoon, shares in Neometals were steady at $0.23.