In just two years, we have transitioned from being a single-asset exploration company to the only producer of natural flake graphite in North America.
It’s a time that has been underscored by our mission to cement our role in the worldwide energy transition and graphite industry in the West, even as unprecedented global geopolitical and trade tensions batter both, challenging equity markets and a global economy racked with some of the highest inflation and interest rates in decades.
We have integrated our legacy operations at Lac des Iles, extended the mine life by approximately eight years, and now supply nearly 20% of the North American industrial graphite market.
Currently, we have more orders than we can fill, and we expect market share gains given the increased output at LDI to 25,000 tons per year (tpy).
We launched the NGC Battery Materials Group (NGCBM), formed by acquiring the assets, R&D, and sales team of Germany’s Heraeus Group battery division, including a fully operational, state-of-the-art electrochemical laboratory in Frankfurt.
The group has proven that our graphite can perform at or above commercial standards in battery anode material for electric vehicles, offers testing services to industry participants, and markets Porocarb®, our patented hard carbon material performance additive for all-solid-state anode material worldwide.
Our Performance
In 2022, the mission of our new management team at Northern was to build “a billion-dollar company within five years,” an ambition that was based on widespread industry projections of an EV industry that would be in full swing by 2025.
While we still maintain that ambition, the timeline has shifted.
China is aggressively pursuing its ambition to corner the EV market and the entire global auto industry by leveraging a decades-long stranglehold on the critical minerals needed to produce lithium-ion batteries, especially graphite.
Today, our competitors in China are heavily subsidised by the state and sell graphite and battery anode material at a significant discount to prices in the West.
Our domestic graphite industry can only compete with government support to level the playing field.
So, what are we doing about it?
We are fighting to accelerate the development of our high-quality graphite assets, including LDI, Bissett Creek, and Okanjande, to meet the significant demand coming down the pipeline from the gigafactories currently being built in North America and Europe. Of course, these expansions will depend on securing project financing and long-term sales contracts with battery makers.
In the past few months alone, as part of the North American Graphite Alliance (NAGA), we have been at the table in the White House with battery makers and auto manufacturers to find ways to build a sustainable graphite industry that protects the strategic interests and energy security of the West; we also met with G7 countries plus Australia and others in Ottawa to discuss how to establish secure critical mineral supply chains to support the EV and energy transitions in the West despite the actions of China.
The good news is that our participation in these efforts is helping to produce results. Most notably, the United States has announced tariffs on Chinese natural graphite imports starting in 2026 and mandated original equipment manufacturers (OEMs) to source their battery-grade graphite domestically beginning in 2027 if their vehicles are to qualify for IRA tax credits.
The United States and Europe have announced tariffs on EV imports to protect their automotive industries from China’s global ambitions, and Canada is soon likely to follow suit.
Changing Course
We have, however, had to change course to adjust to the economic realities of an evolving timeline that has strained our financial resources. We are working with strategic partners, governments, and investors to stabilise our financial position and revise agreements to reflect better revenue projections, which have shifted considerably since we acquired the Imerys assets in 2022.
We are continuing ongoing negotiations with multiple potential battery makers and OEM partners in the US, Asia and Europe, seeking to collaborate with a quality supplier of graphite with current production, immediately available inventory and the capacity to support future growth.
We are optimistic that battery makers and OEMs will be ready to commit to offtake agreements and direct investment as governments in North America and Europe announce policies that clearly define the rules for market engagement in the future. For example, the recently announced 25 per cent US tariff on graphite imports from China is a good start and will bring us closer to competitive pricing.
While we are frustrated with our share price, which reflects neither what we have achieved in the past 18 months nor the enormous potential that lies before us, in the future, we expect our legacy industrial division to provide sufficient and sustainable cash flow to support operations while our battery materials division strives for the home run
