MOSCOW (Reuters) – Russian metals producer Nornickel said on Tuesday it will boost output of nickel products at its Harjavalta plant in Finland as it bets on the expanding market for battery materials needed for electric vehicles (EV).
Finland’s state mining investment firm Finnish Minerals Group, German chemicals giant BASF and Finnish utility Fortum are among companies currently forming an EV battery cluster in Finland.
Nornickel, one of the world’s largest producers of nickel, wants to meet rising demand from those companies in coming years, its head of sales, Anton Berlin told reporters.
Its Harjavalta refinery will expand production of nickel sulphate solution, which is used for the manufacture of intermediate products for lithium-ion batteries.
Being close to customers is vital for this product as long-distance transport eats up the bulk of its profitability, Berlin said.
“We are confident that this market will be rising,” Berlin said. Estimates of nickel consumption by the global electric and hybrid vehicles sector vary from 400,000 tonnes to 700,000 tonnes a year by 2025, he added.
Harjavalta currently produces 65,000 tonnes of nickel products a year, of which 10,000 tonnes comes in nickel sulphate solution.
It plans to raise production of nickel products to 75,000 tonnes by 2023 and to more than 100,000 tonnes by 2026, including at least 40,000 tonnes of nickel sulphate solution.
This solution would be enough to produce 1 million of electric vehicles, based on the current nickel per car usage.
Despite its expansion of raw materials production for the EV sector, Nornickel does not plan to move into actual EV battery production as it believes that “is a completely different business” to its own, Berlin added.
The Harjavalta project will cost the company several tens of million dollars, he added.
(Reporting by Polina Devitt and Anastasia Lyrchikova; editing by Susan Fenton)