ION: New graphite upgrade project to add 25% revenue upside?

Our battery recycling Investment IonDrive (ASX: ION) is now looking to recover graphite from battery waste material…

ION owns a proprietary technology that is able to recycle critical minerals from things like batteries and old electronics (TVs, mobile phones etc).

So far, ION has shown it can recover lithium, nickel, cobalt, and manganese.

Today, ION received grant funding from the CSIRO to develop a process of converting waste graphite from spent lithium-ion into battery-grade anode material.

Graphite makes up ~50% of a lithium-ion battery’s weight, but most conventional recycling technologies just burn off waste graphite and recover other materials.

Why we like today’s news:

First of all there is the financial impacts to ION’s tech…

Benchmark Minerals Intelligence (BMI) says battery-grade graphite is currently priced at:

• US$6,600/t (natural), and
• US$7,000+/t (synthetic)

So if ION can get their recovery yields right and make the grade, it opens up a new revenue stream.

ION said in today’s announcement it expects that impact to be a ~25% uplift in revenues.

Putting aside financials, we think the strategic value of adding graphite recoveries to its technology is also very valuable.

The graphite market has one of the highest levels of supply chain concentration risk - so much so that NATO (North Atlantic Treaty Organization) has deemed graphite supply risk as “very high”:

(Source)

This is where we think recycling could play a role in helping alleviate supply chain risks…

We think ION’s tech could become an option for end users in western markets that are looking to wean off Chinese supply.

Project specifics

Here are the specifics of the testing ION will be doing:

• Backed by two CSIRO grant programs - total funding: $84,000
• Project runs from July to November 2025
• If successful, ION will own the IP exclusively, royalty-free

ION says it expects the new process to be integrated into its commercial-scale flowsheet, with pilot testing on the horizon.

And while all this is happening, ION continues to push toward its Final Investment Decision (FID) for its Pilot Plant, expected this quarter.

What’s next for ION

Here’s what we’re watching for next:

• (NEW) Graphite upgrade results - If ION can produce anode-grade graphite from recycled black mass, it strengthens the commercial case.
  
• Pilot Plant FID - ION expects to reach this decision in July. This would mark the transition from lab to industrial scale (a key share price catalyst).
  
• EU grant decision - ION has also applied for a €3.1M EU grant with an OEM consortium. We expect an update within the next 3 months.
  
• E-waste & nickel processing results - Testwork is ongoing. We expect results from e-waste in Q3, and nickel processing any day now.