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Sustainable battery materials supply chain

2019 marked several key milestones in the consistent execution of Umicore’s long-term growth strategy, shaping a sustainable battery value chain and supporting the growing penetration of Electrical Vehicles (EV) globally. Battery materials customers, wherever they are located, will be supplied with materials of the highest quality with a certified and clean origin.

On 30 November 2019 Umicore acquired Freeport Cobalt’s cobalt refining and cathode precursor activities in Kokkola, Finland. The state-of-the-art Kokkola cobalt refinery is one of the world’s largest. Its refining and precursor know-how ideally complements Umicore’s and the expertise and experience of its 255 employees are highly regarded in the battery materials industry. Both Kokkola and Umicore’s Olen refinery are third- party assessed as compliant by the Raw Materials Initiative’s Responsible Minerals Assurance process. The acquired operations will supply precursors for cathode materials production, including to the new Umicore plant in Nysa, Poland, which is due to start in the second part of 2020.

The Kokkola refinery will be supplied through Umicore’s long-term agreements which source cobalt raw materials exclusively from best-in-class industrial scale cobalt mining operations, in full conformity with Umicore’s sustainable procurement framework for cobalt, the third-party validated due diligence system created to avoid any link between the cobalt and unsustainable practices, including any form of child labor. One example is the long-term revolving agreement with Glencore for the supply of cobalt hydroxide to Umicore which was announced in May 2019 and guarantees Umicore’s security of supply for a substantial part of its longer-term needs. The cobalt will be sourced from Glencore’s state- of-the art industrial mining operations in the DRC. Umicore has assessed each operation in line with its sustainable procurement framework for cobalt and in 2019 performed a full compliance audit of Glencore’s DRC facility. In January 2020, Umicore also signed a long-term supply agreement with CMOC for sustainable cobalt.

During 2019 Umicore also announced partnerships for the supply of Nickel Manganese Cobalt (NMC) cathode materials.

Umicore and LG Chem concluded a multi-year strategic supply agreement for cathode materials to serve LG Chem’s needs from Umicore plants in Poland, Korea and China. The agreement takes effect in 2020 and covers a total volume of 125,000 metric tonnes over several years. The companies are also entering a technology licensing arrangement.

Umicore will be the first company to supply cathode materials to its global customers with identical quality and performance from different production plants across regions.

Umicore is also assisting LG Chem in closing the loop by recycling its production residues and a long-term cooperation in battery recycling is under discussion.

Umicore also signed a multi-year strategic agreement with Samsung SDI for the supply of close to 80,000 metric tonnes of high-performance NMC cathode materials starting in 2020. These materials will be supplied from Umicore plants in different regions with most volumes initially produced in Korea. A vast portion is intended for automotive applications and a smaller part for energy storage systems. The sizeable volume commitment offers critical predictability and visibility along the EV supply chain.