Investing.com — Volkswagen (ETR:) has announced an investment of $48 million in the Canadian lithium company, Patriot Battery Metals (TSX:). The move is part of the German automotive giant’s strategy to secure a steady supply of lithium raw materials from North America.
The investment, announced on Wednesday, includes Volkswagen acquiring a 9.9% stake in Patriot Battery Metals. The deal also includes a binding agreement that obliges Patriot Battery Metals to supply Volkswagen with 100,000 tons of spodumene concentrate annually for a decade.
This agreement will come into effect once the Shaakichiuwaanaan Project in Quebec, which is currently under development, begins production.
The project is expected to supply lithium to Volkswagen’s battery subsidiary, PowerCo, in both Europe and North America.
In addition to the investment and supply agreement, Volkswagen indicated that PowerCo and Patriot Battery Metals will investigate potential collaborations. These may include further development of the Quebec project and the establishment of a lithium conversion facility.
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