Tesla could buy nickel from Canada’s Giga Metal

“Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way,” CEO Elon Musk said in July. Now, it looks as if they may have found such a source, Reuters reports.

++ Please find updates below. ++

According to the news agency, Tesla is in talks to secure a supply of nickel for batteries from a Canadian mining company called Giga Metals. Sources told Reuters, discussions revolved around helping to develop a large mine that would give the electric carmaker access to low carbon nickel for its batteries.

The mining firm declined to comment but pointed out “Giga is actively engaged, and has been for some time, with automakers regarding our ability to produce carbon-neutral nickel.” Reuters’ sources further suggested these carmakers being Germany’s BMW and Daimler. Both said they would not comment on supplier relationships. Neither did Tesla.

What is confirmed is that Giga Metal plans to produce 40,000 tonnes of nickel and 2,000 tonnes of cobalt a year for 20 years. Their Turnagain mine in British Columbia has potential resources of 2.36 million tonnes of nickel and 141,000 tonnes of cobalt, according to its website.

Giga wants to decarbonise the extraction and has access to hydroelectric power in British Columbia. They are also working on a process that would allow the tailings, or waste rock, to absorb carbon dioxide in the atmosphere and turn it into cement type rock, according to the Reuters report.

Though unconfirmed, Tesla having access to materials from within North America would, of course, be beneficial, both with regards to nickel and cobalt. The company had joined the Fair Cobalt Alliance this week, and Canada’s environmental regulations are among the stricter ones in the world.

While Tesla and its battery partner for North America, Panasonic, still combine nickel and cobalt in the current cells, they are looking to go cobalt-free in the long run.

Some Chinese Model 3 already features lithium iron phosphate cells (LFP) from CATL, and the technology is cobalt-free as reported. At the same time, Tesla continues to use NCM-811 cells for the long-range Model 3 in China. The batteries supplied by LG Chem comprise 80 per cent nickel and 10 per cent each cobalt and manganese.

Update 05 October 2020: While confirmation of above news remains outstanding, Reuters suggests a new possible source for nickel mined in Canada. Brazilian mining company Vale is reported to be in talks with Tesla and other electric vehicle companies to supply nickel from its Canadian operations.

Tesla has been seen looking to source locally. Also on Battery Day on 22 September, Tesla boss Elon Musk had stressed the importance of sourcing. Plus, the company wants to use the cheaper nickel primarily for its new battery cells and get rid of cobalt in the long-run. The latter is a move many carmakers, including Tesla, have been striving for.

At the same time, Musk put expectations into perspective, also adding that they “don’t want to be constrained by nickel availability”. Instead, there’s a three-tier approach with high nickel cells for the Semi and Cybertruck, with a 2/3 nickel and 1/3 manganese mix for “intermediate solutions,” that’s cars and the ion mix for stationary energy solutions.

Vale is in the midst of expanding its Voisey’s Bay site to an underground operation that will produce about 40,000 tonnes of nickel-in-concentrate per year, Reuters reports. Tesla had yet to comment although most carmakers keep supplier relations under wraps.

reuters.com (Giga Metal), reuters.com (Vale)