Westwater Resources Announces Off-Take Agreement for Sale of 100% of Fines Graphite Production from its Kellyton Plant

Rhea-AI Summary

Westwater Resources (NYSE: WWR) has announced a binding off-take agreement with Hiller Carbon for the supply of 100% of its natural graphite Fines production from the Kellyton Graphite Plant in Alabama. This agreement, combined with previously announced CSPG off-take agreements with Stellantis and SK ON, means Westwater has now secured sales for 100% of all materials produced from its Kellyton Phase 1 plant.

Under the agreement, Hiller Carbon will purchase approximately 14,000 mt/year of Westwater's Phase I Fines production. Graphite Fines are a byproduct of the CSPG spherodizing process, which is part of producing Westwater's main focus: battery anode natural graphite. This deal marks Westwater's final commercial agreement for securing purchase commitments for all Phase I output, positioning the company to finalize its construction financing.

Positive

• Secured off-take agreement for 100% of Fines production with Hiller Carbon
• Achieved 100% sales commitment for all Kellyton Phase 1 plant production
• Expected annual Fines production of approximately 14,000 mt/year
• Positioned to finalize construction financing

Negative

• None.

Insights

Financial Analyst

This off-take agreement with Hiller Carbon is a significant milestone for Westwater Resources. By securing sales for 100% of its Phase I production, including both CSPG and Fines, the company has effectively de-risked its revenue stream. This comprehensive sales coverage should enhance investor confidence and potentially facilitate easier access to construction financing. The agreement for approximately 14,000 mt/year of Fines production demonstrates strong market demand and validates Westwater's business model. However, investors should note that financial terms were not disclosed, making it challenging to assess the direct revenue impact. Overall, this news positively positions Westwater in the rapidly growing graphite market, particularly as the U.S. seeks to secure domestic supply chains for critical materials.

Market Research Analyst

Westwater's strategic move aligns perfectly with the current market trends in battery materials and green technologies. The partnership with Hiller Carbon, a leader in the steel and foundry industries, opens up diversified market opportunities beyond the electric vehicle sector. This diversification could provide stability against fluctuations in any single industry. The emphasis on local, U.S.-based production is particularly noteworthy, as it taps into the growing demand for domestic supply chains in critical materials. With major automakers like Stellantis already committed, Westwater is positioning itself as a key player in the U.S. graphite market. Investors should watch for potential expansion plans and how Westwater manages the ramp-up of production to meet these substantial commitments.

Tech Expert

The production of graphite Fines as a byproduct of CSPG manufacturing demonstrates Westwater's efficient use of resources. This approach not only maximizes revenue but also minimizes waste, aligning with sustainable manufacturing practices. The company's focus on battery-grade natural graphite positions it well in the rapidly evolving energy storage sector. As electric vehicle adoption accelerates, demand for high-quality graphite is expected to surge. Westwater's ability to secure off-take agreements for both its primary CSPG product and secondary Fines material indicates a strong market position. However, investors should monitor the company's ability to meet production targets and maintain quality standards across its product range, as these will be important for long-term success in the competitive battery materials market.

• Westwater contracts with Hiller Carbon, a leading supplier of materials to the steel and foundry industries, to supply 100% of its natural graphite Fines production.
• With this binding Off-Take Agreement and the previously announced CSPG off-take agreements with Stellantis and SK ON, Westwater has sold 100% of all materials produced from its Kellyton Phase 1 plant.

CENTENNIAL, Colo.--(BUSINESS WIRE)-- Westwater Resources, Inc. (NYSE: American: WWR), an energy technology and battery-grade natural graphite company (“Westwater Resources” or “Westwater”), today announced the execution of a binding off-take agreement for the supply of its Fines material with Hiller Carbon, a leading supplier of pelletized materials to the steel and foundry industries.

Pursuant to the terms of the Off-Take Agreement, Westwater will supply natural graphite Fines material from its Kellyton Graphite Plant located near Kellyton, Alabama to Hiller Carbon’s plants located within the US. Graphite Fines are produced during the CSPG spherodizing process, one of the processing steps related to producing Westwater’s battery anode natural graphite, which remains the company’s main focus.

Under the terms of the Off-Take Agreement, Hiller Carbon will purchase, on an annual basis, 100% of Westwater’s Phase I Fines production which is expected to be approximately 14,000 mt/year. With the previously announced CSPG off-take agreements with Stellantis and SK On accounting for all of its anticipated battery anode material production, Westwater has now secured off-take agreements for the sale of 100% of both its CSPG and Fines Phase I production.

“Our graphite products specifically support current and future green carbon initiatives. We are excited to partner with Westwater Resources, a new and important natural graphite producer based in the U.S. Securing a local, reliable, and long-term source for this critical material is significant for our business and positions both our companies for long-term success,” said Martin (Marty) Hiller, Executive Chairman of Hiller Carbon.

Jon Jacobs, Westwater’s Chief Commercial Officer, added, “We are honored to work with the great team at Hiller Carbon. This deal represents our final commercial agreement for securing purchase commitments for all of our Phase I output and positions us to finalize the remainder of our construction financing.”

About Westwater Resources, Inc.

Westwater Resources is an energy technology company that is focused on developing battery-grade natural graphite. Westwater Resources’ primary project is the Kellyton Graphite Processing Plant that is under construction in east-central Alabama. In addition, Westwater Resource’s Coosa Graphite Deposit is the most advanced natural flake graphite deposit in the contiguous United States — and is located across 41,965 acres (~17,000 hectares) in Coosa County, Alabama. For more information, visit westwaterresources.net.

About Hiller Carbon

Hiller Carbon is a major supplier of carbon products to Electric Arc Furnace (EAF) steel, foundry, and specialty industrial users in domestic U.S. and international markets. Founded in 1975, the company’s distribution network supplies critical products such as anthracite coal, petroleum coke, and graphite. For additional information, visit www.hillercarbon.com.

Cautionary Statement Regarding Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as “anticipated,” “will,” “expected,” “secure or securing,” “long-term,” and other similar words. Forward-looking statements in this release include, among other things, statements concerning Westwater’s future sales of graphite products to Stellantis and SK On, including the amounts, timing, and types of products included within those sales, Westwater’s expectations with respect to this Off-Take Agreement with Hiller Carbon, and Westwater’s process of securing the remainder of construction financing for Kellyton Phase I. Westwater cautions that there are certain factors that could cause actual results to differ materially from the forward-looking information that has been provided. The reader is cautioned not to put undue reliance on this forward-looking information, which is not a guarantee of future performance and is subject to a number of uncertainties and other factors, many of which are outside the control of Westwater; accordingly, there can be no assurance that such suggested results will be realized. Additional risks facing Westwater‘s future prospects are discussed in the Westwater Resources, Inc. Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent securities filings.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240917898152/en/

Westwater Resources, Inc.

Email: Info@WestwaterResources.net

Investor Relations

Email: Investorrelations@westwaterresources.net

Source: Westwater Resources, Inc.

FAQ

What is the significance of Westwater Resources' off-take agreement with Hiller Carbon?

The off-take agreement with Hiller Carbon secures the sale of 100% of Westwater Resources' natural graphite Fines production from its Kellyton Plant. This, combined with previous agreements, means WWR has now sold 100% of all materials produced from its Kellyton Phase 1 plant, positioning the company to finalize its construction financing.

How much graphite Fines production is Hiller Carbon expected to purchase annually from Westwater Resources (WWR)?

According to the off-take agreement, Hiller Carbon will purchase approximately 14,000 mt/year of Westwater Resources' Phase I Fines production from the Kellyton Graphite Plant.

What are the other off-take agreements Westwater Resources (WWR) has secured for its Kellyton Phase 1 plant production?

In addition to the Fines agreement with Hiller Carbon, Westwater Resources has previously announced CSPG (Coated Spherical Purified Graphite) off-take agreements with Stellantis and SK ON for its battery anode material production from the Kellyton Phase 1 plant.

Where is Westwater Resources' (WWR) Kellyton Graphite Plant located?

Westwater Resources' Kellyton Graphite Plant is located near Kellyton, Alabama, in the United States.