Novonix shares soar as it talks deal with oil ‘enemy’ of Saudi Arabia
Novonix will head to the heartland of global oil production in a joint venture to develop a battery materials project in Saudi Arabia.
Novonix will head to the heart of oil production (Jacob Ford/Odessa American via AP)
The company, which is based in North America but has Brisbane connections through its major investor Trevor St Baker, will enter a partnership with TAQAT, a company headed by former Saudi Aramco executive Jamal A. Al Bassam.
The Novonix board also includes Brisbane Olympics boss Andrew Liveras and former State Government bureaucrat Tony Bellas.
The JV would use Novonix’s technology to establish a graphite anode materials facility with production of 30,000 tonnes a year. It follows a decision late last year to downgrade production from its American facility.
The announcement sent Novonix shares soaring 21 per cent this morning before dropping back to a 9 per cent increase.
Novonix said the project had been in discussion since 2021 and comes as Saudi Arabia attempts a major electric vehicle push. Its wants 30 per cent of all cars on the road to be EVs by 2030.
To support this strategy it has launched a Saudi EV, Ceer.
“Upstream projects such as an anode materials facility to be built under this JV will help support a localised supply chain for this sector in Saudi Arabia,” Novonix said.
The Saudis would hold 60 per cent of the JV with each to contribute capital costs on that basis. Novonix would also contribute its intellectual property to the JV royalty-free.
Targeted production from the facility is 2024.
Novonix chief executive Chris Burns said he was very excited by the possibilities of the JV.
“The joint venture will leverage Novonix’s existing work in North America and will allow us to more quickly scale up our oeprations to extend our geographical reach to the global market,” Burns said.
“We believe this joint venture will enhance our financial strength and profitability by both driving revenues and accessing cost competitive, quality feedstock for projects outside North America.”
Novonix would have the right to appoint the chief executive and chief operating officer for the JV. TAQAT would have the right to appoint three of the five directors.
Decisions related to major disposals or acquisitions, joint venture, debt, capital spending and litigation would require the approval of at least one Novonix director and one TAQAT director.
