SK On Partners with Westwater for Domestic Natural Graphite Supply

Westwater Resources, Inc. has achieved a significant milestone by securing its first off-take agreement with SK On Co., Ltd., an electric vehicle (EV) battery manufacturer. Under the agreement, Westwater will supply natural purified graphite anode material from its Kellyton Graphite Plant to SK On's battery plants in the US. As per the agreement's stipulations, SK On can procure a combined quantity of 34,000 tons of natural graphite anode products derived from Westwater’s Kellyton Graphite Plant near Kellyton, AL, from 2027 to 2031.

This collaboration marks an expansion of the existing partnership between SK On and Westwater, which was initiated with a joint development agreement last year. The companies have been developing environmentally sustainable and high-performance anode materials tailored specifically for SK On's batteries. Anode materials are integral to lithium-ion batteries, influencing their lifespan and charging efficiency, making the partnership pivotal for SK On's future battery innovations.

The off-take agreement solidifies Westwater’s position as one of the pioneering US-based suppliers of naturally purified graphite for EV battery manufacturers. Moreover, it signifies Westwater's efforts to establish a reliable and compliant source of graphite, addressing the industry's growing need for domestic sustainable materials.

Related:SK On Pushes Smart Battery Manufacturing Forward

During the latest earnings call, Frank Bakker, Westwater’s President & CEO, said, “Although the current graphite anode supply chain is well established, incentives and guidance like the IRA, the Foreign Entity Of Concern, and a 25% tariff on graphite imports are critical in motivating battery and EV manufacturers to replace their current source of graphite anode materials with sources located in the US.”

Bakker continued, “While some US automakers have seen some softening in consumer demand for EVs, US EV sales were up 11.8% in the third quarter compared to the same quarter in 2022, according to Benchmark Minerals. Currently, the US is 100% dependent on foreign imports of natural battery-grade graphite, and nearly 100% of today's graphite anode materials are processed to some degree in China.”

Westwater is actively negotiating additional off-take agreements with other customers, signaling its intention to expand its market presence further. This development showcases Westwater's progress in securing partnerships and advancing its graphite processing capabilities and underscores its strategic positioning in the EV supply chain.

Partnering with Westwater Resources allows SK On to diversify its supply chain and establish a direct relationship with a US-based graphite producer. This strategic partnership may offer SK On advantages such as competitive pricing, improved supply chain transparency, and potentially reduced transportation costs compared to importing from other regions.

Related:SK On & Westwater Resources to Develop Anode Materials

At the same time, by sourcing natural graphite anode material domestically from Westwater's Kellyton Graphite Plant, SK On reinforces its commitment to establishing a solid presence in the US market and potentially translating into improved product quality, cost-efficiency, and potentially faster delivery times, enhancing SK On's competitiveness in the US EV battery market.