NOVONIX Limited and LG Energy Solution (LGES) inked a Joint Research and Development Agreement (JDA) to collaborate on developing artificial graphite anode materials for lithium-ion batteries.
NOVONIX has agreed to issue US$30 million in aggregate principal amount of unsecured convertible notes to LGES in a separate agreement.
Following the completion of certain development work under the JDA, LGES and NOVONIX will enter into a separate purchase agreement under which LGES will have the option to purchase up to 50,000 tonnes of artificial graphite anode material over 10 years, beginning with the start of mass production.
With two stand-alone and five joint venture plants currently operating or under construction in the United States, LGES intends to maximise the Inflation Reduction Act (IRA) benefits by expanding local battery production and establishing a local supply chain for battery components. To maintain its market leadership in North America, LGES intends to accelerate the localisation of battery component manufacture and assembly, including electrodes, cells, and modules.
NOVONIX seeks to provide a solid, sustainable supply chain option for high-performance artificial graphite in North America, a goal that LGES supports as it grows battery cell manufacturing and diversifies its suppliers. NOVONIX, based in Chattanooga, Tennessee, will develop IRA-compliant products for its customers in the United States. The Department of Energy selected the company for a US$150 million grant to boost its development, demonstrating the government’s commitment to the battery supply chain industry.
Since December 2022, LGES and NOVONIX have been in informal talks about financing and joint development of artificial graphite anode material that fits LGES’s standards. The material will be created at NOVONIX’s present Tennessee-based facilities. Then, in 2026, NOVONIX’s anticipated greenfield facility in the United States will begin mass production.
NOVONIX’s projected greenfield facility would initially produce 30,000 tonnes of active anode material annually. NOVONIX has sought a loan from the U.S. Department of Energy’s Loan Program Office under the Advanced Technology Vehicles Manufacturing Loan Program to assist with the facility’s funding. NOVONIX continues to explore and negotiate the procurement of anode materials from its greenfield facilities with additional original equipment manufacturers and cell makers.
“Our partnership with NOVONIX once again demonstrates LG Energy Solution’s determination to establish a solid battery supply chain in the U.S., complementing our local manufacturing network to meet our customers’ needs for lRA-compliant batteries,” said Dongsoo Kim, Senior Vice President of Procurement Center at LG Energy Solution. “As we work with NOVONIX in developing a new source of artificial graphite anode material, we will stay committed to strengthening our product competitiveness and operation excellence, delivering the world-best quality products both in scale and with speed.”
Chris Burns, CEO of NOVONIX, said, “We are excited to formalize our work with LG Energy Solution and establish the path for NOVONIX to become a supplier for LGES of artificial graphite anode material in the United States. This agreement demonstrates our leading position to establish a supply chain for high-performance artificial graphite for the battery industry in North America.”
