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BASF, Canada in early talks on EV battery production

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Several companies, including Germany’s BASF SE, are in preliminary talks about tapping a federal clean tech fund to set up production for electric vehicle batteries in Canada, a government official with knowledge of the discussions said.

The talks are centered on understanding whether the goals of BASF and others fit with the aim of the C$8 billion ($6.6 billion) “Net Zero Accelerator” (NZA) fund, the source said. Canada has set a goal to reach net zero emissions by 2050.

BASF is a key supplier of cathode active materials (CAM) needed for the production of lithium-ion batteries in electric vehicles (EV), and is the world’s largest chemicals and plastics producer by sales.

Canada is an interesting destination for potential production given its access to rising battery cell manufacturers in North America and its access to raw materials that are needed for the production of cathode materials,” BASF said in a statement to Reuters.

“BASF currently examines several options in various regions to further expand its production network in this fast growing market for battery materials and to continue to support its customers,” it added, without confirming the talks with the Canadian government.

John Power, spokesman for Canada‘s Industry Minister Francois-Philippe Champagne, said he could not comment on the status of any discussions. The talks are preliminary and are no guarantee of a deal, the source said.

BASF, in partnership with Japan’s Toda Kogyo Corp, already produces CAM at two locations in North America – Ohio and Michigan – including nickel cobalt aluminum oxide and nickel cobalt manganese oxide.

BASF has been seeking access to battery-grade cobalt and nickel, for instance through partnerships with Russia’s Norilsk Nickel and France’s Eramet.

On Thursday, BASF also unveiled a 51%-49% joint venture with Shanshan to produce CAM in China, the world’s largest car market.

CANADA SEEKING TO WOO BATTERY MAKERS

According to market research firm ReportLinker, the global CAM market is expected to grow to $23.3 billion by the end of 2025 from $16.8 billion in 2019, boosted by an expected global boom in electric vehicle sales.

Rich in key materials for EV battery production – including lithium, graphite, cobalt and nickel – Canada is trying to woo battery makers to safeguard the future of its manufacturing heartland in Ontario as the world seeks to cut emissions.

Ontario is geographically close to U.S. automakers in Michigan and Ohio, and General Motors Co, Ford Motor Co and Stellantis NV have all announced plans to make electric vehicles at factories in Ontario.

“We are ensuring we have the policies necessary to attract the electric vehicle and battery supply chains to Canada,” Industry Minister Champagne said in a statement.

The “Net Zero Accelerator” “will support job creation and our long-term prosperity, and position Canada as a global leader,” he added.

Current EV sector manufacturers in Canada include GreenPower, Lion Electric, New Flyer, and Nova Bus, which is owned by Sweden’s Volvo’s.

Other European and Asian players are exploring options for how to enter the Canadian market, including Austrian lithium-ion battery maker Kreisel Electric, which licenses its technology to clients for a fee.

“We are in very concrete talks with a very large player in the bus and trucks industry,” said Gernot Friedhuber, who holds a 15% stake in Kreisel Electric with a fellow investor.

“Should the decision be made in our favor, we would build production on site and create value in Canada.”

Chinese EV maker BYD Co Ltd, which is backed by U.S. investor Warren Buffett and already operates a bus factory in Ontario, said Canada was an “extremely important” market for the Shenzhen-based group.

“Already, BYD is participating in pilot programs in several provinces and the company hopes to expand that presence over the next several years,” it said, without providing details.

($1 = 1.2102 Canadian dollars)

 

(Reporting by Steve Scherer in Ottawa and Christoph Steitz in Frankfurt; additional reporting by Ludwig Burger and Patricia Weiss; editing by Jonathan Oatis)

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Brazil’s Vale says output begins at Reid Brook nickel deposit in Canada

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Vale’s Voisey’s Bay nickel mine in Northern Labrador has started the production at its Reid Brook deposit, the Brazilian miner said in a securities filing on Tuesday.

Vale said the Canadian Reid Brook and Eastern Deeps mines are likely to produce 40,000 tonnes of nickel by 2025.

 

(Reporting by Carolina Mandl; editing by Jason Neely)

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EU, U.S. agree to talk on carbon border tariff

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The United States and European Union agreed on Tuesday to hold talks on the bloc’s planned carbon border tariff, possibly at the World Trade Organisation, EU chief executive Ursula von der Leyen said.

U.S. President Joe Biden met European Commission President von der Leyen and European Council President Charles Michel on Tuesday for a summit tackling issues from trade to the COVID-19 pandemic.

The leaders also discussed climate change policy, including the EU’s plan to impose carbon emissions costs on imports of goods, including steel and cement, which the Commission will propose next month.

“I explained the logic of our carbon border adjustment mechanism,” von der Leyen told a news conference after the summit.

“We discussed that we will exchange on it. And that WTO might facilitate this,” she said.

Brussels and Washington are keen to revitalise transatlantic cooperation on climate change, after four fractious years under former president Donald Trump.

On Tuesday, they outlined plans for a transatlantic alliance to develop green technologies and said they will coordinate diplomatic efforts to convince other big emitters to cut CO2 faster.

But the EU border levy could still cause friction. A draft of the proposal said it would apply to some U.S. goods sold into the EU, including steel, aluminium and fertilisers.

Brussels says the policy is needed to put EU firms on an equal footing with competitors in countries with weaker climate policies, and that countries with sufficiently ambitious emissions-cutting policies could be exempted from the fee.

The United States and EU are the world’s second- and third- biggest emitters of CO2, respectively, after China.

A draft of the EU-U.S. summit statement, seen by Reuters, repeated commitments the leaders made at the G7 summit at the weekend to “scale up efforts” to meet an overdue spending pledge of $100 billion a year by rich countries to help poorer countries cut carbon emissions and cope with global warming.

It did not include firm promises of cash. Canada and Germany both pledged billions in new climate finance on Sunday, and campaigners had called on Brussels and Washington to do the same.

The draft statement also stopped short of setting a date for the United States and EU to stop burning coal, the most polluting fossil fuel and the single biggest of greenhouse gas emissions.

Brussels and Washington said they will largely eliminate their CO2 emissions from electricity production by the 2030s.

 

(Reporting by Kate Abnett, additional reporting by Valerie Volcovici; Editing by Marguerita Choy, Andrew Heavens and Barbara Lewis)

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U.S. fine Air Canada $25.5 milliom over delayed refunds

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The U.S. Transportation Department said on Tuesday it was seeking a $25.5 million fine from Air Canada over the carrier’s failure to provide timely refunds requested by thousands of customers for flights to or from the United States.

The department said it filed a formal complaint with a U.S. administrative law judge over flights Air Canada canceled or significantly changed. The penalty is “intended to deter Air Canada and other carriers from committing similar violations in the future,” the department said, adding Air Canada continued its no-refund policy in violation of U.S. law for more than a year.

Air Canada said it believes the U.S. government’s position “has no merit.” It said it “will vigorously challenge the proceedings.”

Air Canada obtained a financial aid package this spring that gave the carrier access to up to C$5.9 billion ($4.84 billion) in funds through a loan program.

The carrier said it has been refunding nonrefundable tickets as part of the Canadian government’s financial package. Since April 13 eligible customers have been able to obtain refunds for previously issued nonrefundable tickets, it said.

The Transportation Department disclosed it is also “actively investigating the refund practices of other U.S. and foreign carriers flying to and from the United States” and said it will take “enforcement action” as appropriate.

The administration said the Air Canada penalty sought was over “extreme delays in providing the required refunds.”

Refund requests spiked during the COVID-19 pandemic.

Since March 2020, the Transportation Department has received over 6,000 complaints against Air Canada from consumers who said they were denied refunds for flights canceled or significantly changed. The department said the airline committed a minimum of 5,110 violations and passengers waited anywhere from five to 13 months to receive refunds.

Last month, a trade group told U.S. lawmakers that 11 U.S. airlines issued $12.84 billion in cash refunds to customers in 2020 as the coronavirus pandemic upended the travel industry.

In May, Democratic Senators Edward Markey and Richard Blumenthal called on carriers to issue cash refunds whether flights were canceled by the airline or traveler.

($1 = 1.2195 Canadian dollars)

(Reporting by David Shepardson in WashingtonAdditional reporting by Allison Lampert in MontrealEditing by Matthew Lewis)

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