Tesla reportedly in talks with Canada’s Giga Metals to establish environmentally friendly nickel mine in British Columbia as it expands battery production
Tesla is reportedly in talks with Canadian mining company Giga Metals about developing a large mine to give it access to a ready supply of nickel and cobalt for its electric vehicle batteries.
Worldwide demand for nickel, used to store energy in batteries, is expected to skyrocket in the coming years as drivers shift to electric vehicles.
But most new nickel production is expected to come from Indonesia, where the process would involve dumping mining waste into the ocean.
Tesla wants to work with Giga Metals to develop a mining process that would involve allowing mining waste rock, called tailings, to absorb carbon dioxide in the atmosphere to produce a cement-type rock, Reuters said, citing unnamed sources.
The process could in theory absorb an amount of carbon similar to that produced by the mine’s diesel-powered machinery, up to around 28,000 tonnes, the report said.
Giga would also have access to hydroelectric power in British Columbia.
“Tesla will give you a giant contract for a long period of time, if you mine nickel efficiently and in an environmentally sensitive way,” Tesla chief executive Elon Musk said during the company’s July earnings call.
“So hopefully this message goes out to all mining companies: please get nickel.”
The early-stage Turnagain mine in British Columbia has measured resources of 2.36 million tonnes of nickel and 141,000 tonnes of cobalt, accordin to Giga.
The company plans to produce 40,000 tonnes of nickel and 2,000 tonnes of cobalt per year for 20 years, enough for thousands of electric vehicle batteries.
Tesla could reportedly assist with financing the mine, which requires about $1 billion (£780m) in startup costs, in exchange for equity, nickel and cobalt.
Giga declined to comment on the report.
“Giga is actively engaged, and has been for some time, with automakers regarding our ability to produce carbon-neutral nickel,” Giga president Martin Vydra said in a statement.
Following Reuters’ report, the company’s share price nearly doubled to close up 184 percent on Friday, after which Vydra added that it had “no material announcement” for the time being.
“Giga Metals has been mentioned in recent media articles as they pertain to ongoing efforts to advance the Turnagain deposit to commercialisation,” Vydra stated.
“What I can say is that there is no material announcement forthcoming and we will keep regulators and investors informed of any material changes that require disclosure in accordance with securities regulations.”
To date, Tesla has tended to partner with established mining companies such as Glencore and Ganfeng Lithium for raw materials.
The company is establishing a major vehicle production facility in Berlin as it seeks to expand the European electric vehicle market.