In July 2020, CEO Elon Musk used the telephone conference on the Tesla business figures in the second quarter of the year for public appeals. First he asked for applications for the new Gigafactory in Texas, the location of which he had previously confirmed, then he called on nickel producers to increase their production and promised a “huge contract” from Tesla in the event that it was in high volume and succeed in an environmentally friendly way. Tesla now seems to have found such a supplier: Talon Metals, which owns the rights to a large raw material deposit in the north of the USA.
Nickel for Tesla with CO2 storage
The US subsidiary of the company, which is listed on the Toronto Stock Exchange, has concluded an agreement with Tesla to purchase nickel concentrate from the Tamarack project in the US state of Minnesota, it said on Monday. The electric car manufacturer has promised to buy 75,000 tons from there and also has a right of first refusal on quantities in excess of this. The deal will run for six years, although it will not begin until the beginning of 2026. By then, or at most a year later, Talon plans to mine nickel on a large scale in Minnesota.
Tesla technology boss Drew Baglino praised the new partner in the announcement. Talon is going innovative ways in the exploration, development and production of raw materials, he is quoted as saying. He also emphasized that the company wanted to store carbon dioxide as part of its mining operations. That should correspond to the environmentally friendly approach demanded by CEO Musk. Baglino said the project has the potential to accelerate the production of sustainable energy products. On the occasion of the agreement, Talon published a photo of a Model Y with advertising for it (see above)
According to a report in The Spokesman Review, there are some peculiarities about the project. Nickel as well as copper and cobalt can be found on the Talon site – for the first time, the focus there will be on nickel extraction. The agreement with Tesla also mentions cobalt, but only as a by-product, the economic benefits of which both sides want to share. Nickel such as cobalt is currently used for the most powerful batteries, but at Battery Day in September 2020 Tesla announced that nickel would be maximized and cobalt removed in the cathodes for its own 4680 cells.
For the first time battery raw materials from the USA
As reported by the news agency Reuters, the Talon agreement is the first under which Tesla procures nickel from the United States. Last July, the company had already secured nickel in unknown volumes from the BHP Group in Western Australia and in October from a community mine in New Caledonia. With Rio Tinto, another large raw materials company has a 49 percent stake in the Tamarack project in Minnesota. According to the Spokesman Review report, however, this mine still has to prove its economic viability and obtain the necessary permits for mining.
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