Mr. Michael Insulan reports

ELECTRA AND THREE FIRES GROUP ADVANCE CANADA'S FIRST INDIGENOUS-LED BATTERY RECYCLING VENTURE

Electra Battery Materials Corp. has made significant progress on the Aki Battery Recycling joint venture, the first indigenous-led lithium-ion-battery recycling initiative in Canada. Aki is pioneering a low-emission, circular solution for managing battery waste, strengthening domestic supply chains and reducing reliance on offshore processing.

Since launching the joint venture in 2024, key milestones and strategic developments include:

• Formal establishment of Canada's first indigenous-led lithium-ion-battery recycling venture, with Reggie George appointed as president and Andre Marais as director of strategy and corporate development;
• Shortlisting of technology partners following site visits and comprehensive due diligence on advanced battery recycling platforms;
• Continuing engagement with government partners to secure financing for a bankable feasibility study;
• Evaluation of prospective sites, with plans to co-locate or near-locate the facility alongside lithium-ion-battery manufacturers and on or near first nations lands to maximize regional impact;
• Integration with Electra's hydrometallurgical refinery, enabling local processing of black mass into battery-grade materials for original equipment manufacturers, establishing a fully Canadian closed-loop supply chain.

Under the Aki Battery Recycling joint venture, Three Fires Group and Electra have partnered to establish a first-nations-led lithium-ion-battery recycling company. Aki will process lithium-ion-battery end-of-life and manufacturing scrap in a state-of-the-art preprocessing facility to produce high-grade copper, aluminum and steel products through a battery pack and module dismantling process. The remaining material is then put through a shredding process to generate a high-value intermediate product known as black mass.

Black mass contains critical minerals such as lithium, nickel, cobalt, manganese and graphite, which can be separated into saleable products through a subsequent refining process. Black mass from the preprocessing facility will be processed at Electra's hydrometallurgical refinery north of Toronto and then returned to battery manufacturers to establish a localized closed-loop supply chain.

Mr. George has been appointed president of Aki, bringing more than a decade of experience in project management and capital raising. Mr. George is a member of Kettle and Stony Point First Nation, and has an accomplished record with start-ups in emerging technologies. Through his work with the Three Fires Group, Mr. George has been involved in more than $3-billion in infrastructure and development projects in Ontario. Mr. Marais has been appointed director of strategy and corporate development for Aki, bringing more than 15 years of experience encompassing both technical and commercial roles.

At the heart of Aki Battery Recycling is a commitment to indigenous economic participation in the growing battery supply chain. The joint venture reflects a shared vision to create meaningful, long-term benefits for first nations communities while pursuing innovation to enhance the sustainability of the critical mineral supply chain.

"First nations participation in Canada's emerging clean energy economy is essential," said Mr. George. "The Aki partnership is rooted in mutual respect, shared benefit and environmental accountability.

"Lithium-ion-battery recycling aligns with traditional values of stewardship and responsibility for the land," Mr. George continued. "By reclaiming materials and minimizing waste, Aki embodies a regenerative model of economic growth that supports both people and planet. Through this venture, we are creating long-term opportunities, reclaiming ownership over our resources and building an economy that is both clean and culturally grounded."

Three Fires Group will lead capital sourcing efforts and site selection for a state-of-the-art, environmentally friendly recycling facility in Southern Ontario. Electra's contribution includes technical and commercial expertise, as well as a refining solution, to ensure that critical minerals from recycled batteries remain in the domestic supply chain. Aki's preprocessing facility is designed for scalability and replication, with plans to expand operations in step with the growing demand for lithium-ion-battery recycling.

In its initial phase, the proposed facility will recycle enough lithium-ion-battery scrap to supply up to 100,000 new electric vehicles each year.

"Ontario currently has no battery recycling capabilities, even as projections show the province could generate up to 30,000 tonnes of battery scrap annually by 2030," said Mr. Marais. "By aligning recycling capacity growth with gigafactory expansion, Aki addresses a critical supply chain gap and positions Ontario as a leader in the responsible recovery of battery materials essential to the energy transition."

Aki has established a short list of technology partners aligned with a commitment to low-emission processing and high-quality black mass production. Site selection is also advancing, with a focus on a limited number of locations in Southern Ontario near emerging gigafactories, maximizing proximity to key customers and economic benefits for surrounding communities.

Building on the joint venture's initial scoping study, Aki is engaged in discussions with government partners to secure financing for a bankable feasibility study on the preprocessing facility. The project is well aligned with several Canadian financing streams, including regional economic development programs and indigenous loan guarantee programs at both the federal and provincial levels, many of which prioritize clean technology and indigenous-led infrastructure.

Electra's hydrometallurgical refinery north of Toronto will process black mass produced by Aki, which is anticipated to result in one of the lowest carbon footprint recycling supply chains in the world. The black mass will be treated using Electra's proprietary process to recover critical minerals that can be reintroduced into the battery supply chain.

"The integration of Aki's upstream black mass production with Electra's downstream hydrometallurgical refining creates a vertically aligned, closed-loop system optimized for efficiency, traceability and material recovery," commented Dr. George Puvvada, technology adviser to Aki Battery Recycling. "This alignment ensures feedstock consistency and process compatibility, enabling the higher recoveries of battery-grade materials that meet OEM specifications for reintegration into North American cell production."

Unlike most other North American preprocessing facilities, Aki will operate predominantly on a tolling fee basis through long-term contracts. This creates a strong alignment of interests with battery manufacturers and ensures that Aki achieves a consistent return, independent of commodity prices.

"The current bidding model for battery scrap widely used in North America is unsustainable," said Michael Insulan, vice-president, commercial, at Electra. "Offshore recyclers backed by deep pockets and government subsidies can outbid domestic players, undermining competition and market efficiency. In contrast, long-term tolling agreements offer a more stable and scalable alternative, providing predictability in feedstock volume and composition, and enabling greater operational efficiency over time."

Currently, it is estimated that the vast majority of black mass produced in North America is exported to China, directly or indirectly, where it is processed into battery-grade materials for Asian supply chains. The circular relationship between Aki and Electra will strengthen Canada's capacity to retain and reuse critical minerals, supporting domestic industrial growth. This is not only aligned with stated Canadian economic growth policies but also serves to reduce carbon emissions related to the transportation of materials to and from Asia.

"The Aki venture has rapidly advanced from vision to execution," Mr. George concluded. "We are building something that addresses both economic and environmental imperatives, while also putting indigenous leadership at the centre of the clean energy transition."

About Electra Battery Materials Corp.

Electra is a leader in advancing North America's critical mineral supply chain for lithium-ion batteries. Currently focused on developing North America's only cobalt sulphate refinery, Electra is executing a phased strategy to onshore critical mineral refining and reduce reliance on foreign supply chains. In addition to establishing the cobalt sulphate refinery, Electra's strategy includes nickel refining and battery recycling. Growth projects include integrating black mass recycling at its existing refining complex, evaluating opportunities for cobalt production in Becancour, Que., and exploring nickel sulphate production potential in North America.

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