Lithium Australia’s Adrian Griffin highlights battery collection deal with Bunnings

21 Oct 2021 Proactive Investors | By Andrew Scott

Lithium Australia NL (ASX:LITOTC:LMMFF)’s Adrian Griffin discusses a battery collection and supply contract that subsidiary Envirostream Australia Pty Ltd has agreed with Bunnings. It follows news Envirostream was issued an important planning permit for its battery recycling facility in Campbellfield, Victoria. Griffin also discusses a ‘breakthrough’ announced by subsidiary VSPC in anode materials.

HIGHLIGHTS

  • Bunnings Group Limited (‘Bunnings’) has executed a Supply of Services
    Agreement – Battery Stewardship Scheme (‘Agreement’) with Envirostream
    Australia Pty Ltd (‘Envirostream’) for the collection of spent batteries from its
    stores in Australia and selected stores in New Zealand.
  •  The Agreement – reached in anticipation of the launch of the Battery
    Stewardship Scheme (‘BSS’) to be rolled out by Australia’s Battery Stewardship
    Council (‘BSC’) in early 2022 – will continue until 30 June 2024.
  • Bunnings has the option to extend the Agreement for a further 12 months

Implementation of Agreement

Lithium Australia NL (ASX: LIT, ‘the Company’) has a 90% ownership interest in Envirostream. The Company wishes to advise completion of the Agreement, a contract between Envirostream and Bunnings that allows for provision of services by Envirostream to begin immediately. Envirostream has already trialled its spent-battery collection services in several Bunnings stores within Victoria.

In preparation for the BSS, Bunnings and Envirostream have worked together to ensure drop-off points for spent batteries within the Bunnings infrastructure are not only convenient for customers but also facilitate efficient spent-battery collection by Envirostream.

Agreement terms

The Agreement runs until 30 June 2024, at which time Bunnings has the option to extend it for a further 12 months. Envirostream will provide a Battery Product Stewardship Program (‘Program’) at all relevant sites across Australia and New Zealand.

The Program must incorporate all the requirements of the BSS for managing every type of battery covered by the BSS (‘Services’).

The Services include, but are not limited to:

  • provision and maintenance of suitable collection units for spent batteries;
  • collection and transportation of spent batteries from all Bunnings sites;
  • recycling of the spent batteries collected from Bunnings sites;
  • education and participation in marketing campaigns, in conjunction with Bunnings,
    and
  • reporting.

The BSS is currently anticipated to be operational from 1 January 2022. Service fees
and service rebates for Australia are linked to the expected rebates payable on a per kilogram-collected basis from commencement of the BSS.

Basel Import Permit AUH21-020

The Australian federal Department of Agriculture, Water and the Environment recently issued Envirostream with a Basel Import Permit, which allows for the import of 100 tonnes of mixed-waste batteries into Australia from New Zealand. The permit, which allows Envirostream to service the Bunnings’ New Zealand stores, is valid until 14 October 2022. Once imported into Australia, the waste will be recycled at Envirostream’s EPA-licensed Campbellfield facility and its Laverton North facility, which is currently in development.

Comment from Lithium Australia managing director Adrian Griffin

“The Company is pleased to announce that Envirostream will commence a service
contract with Bunnings, which is leading the way in the provision of convenient collection points for spent batteries ahead of the BSS. The creation of such a collection infrastructure is vital to improving Australia’s battery recycling rate and preventing spent batteries from being consigned to landfill.”

The Company requests that the trading halt be lifted.

HIGHLIGHTS

  • Hume City Council has issued a planning permit to Envirostream Australia for
    its battery recycling facility in Campbellfield, Victoria.
  • The permit allows a change in land use to that of a materials recycling facility

Overview

Lithium Australia NL (ASX: LIT, ‘the Company’) has a 90% ownership interest in Envirostream Australia Pty Ltd (‘Envirostream’). As outlined in the ASX release dated 5 October 2021, a change-of-land-use application for Envirostream’s activity site in Berwick Road, Campbellfield, Victoria was in progress at the Hume City Council (‘Council’). Envirostream is pleased to advise that the planning permit the subject of that application has now been received.

Resource recovery

Envirostream – whose activities align with the Council’s commitment to infrastructure essential to meet waste and resource recovery – applied to the Council for a change in land use for the establishment and expansion of a materials recycling facility that had minimal impact on the environment and amenity of the area. Envirostream has since worked closely with the Council to ensure its operation meets the requirements of the planning scheme, and this led to approval of the change-in-land-use application. The planning permit is conditional on Envirostream’s compliance with the management plans it submitted with the original application.

Battery materials

The Hume City Council planning permit, together with the recently issued EPA operating licence, provides Envirostream with the formal approvals necessary to expand its operating throughput for the recycling of spent batteries at its Campbellfield facility.

Envirostream is the first company to achieve such approvals, which are specifically for the recycling of spent batteries. This represents an important commercial prelude to the introduction of the national Battery Stewardship Scheme scheduled for implementation in January 2022.

Comment from Lithium Australia MD Adrian Griffin

“Envirostream – now the first mixed-battery recycler in Victoria to be fully permitted –
seeks to reduce the volume of waste batteries relegated to landfill as it gears up to meet the introduction of the Battery Stewardship Scheme early next year.”

HIGHLIGHTS

  • The EPA Victoria-issued operating licence provides the environmental and legal
    framework for Envirostream Australia to continue battery recycling activities at
    its premises in Campbellfield, Victoria.
  • The licence permits Envirostream Australia to process more than 500 tonnes of
    specified electronic waste annually.

Comment from Lithium Australia managing director Adrian Griffin

“EPA licensing of our Victorian battery recycling facility for the next 99 years ensures that environmental safeguards are in place for the ever-increasing battery utilisation required to decarbonise the economy.

“Australia has an environmental duty of care to establish compliant recycling facilities that can safely process the expected increase in volume of end-of-life batteries, providing sustainable materials for this critically important manufacturing sector and reducing environmental pollution – the legacy of what has until now been a poorly managed industry.

“As part of the process of obtaining that 99-year licence, Lithium Australia and Envirostream Australia worked together to develop specific, in-house improvements that enhance safety in the collection, storage and processing of spent batteries and further reduce any fire risk associated with their recycling. We lead the industry in that respect.

“The roll-out of a national battery stewardship scheme that commoditises spent batteries and discourages their disposal in landfill is imminent and this will certainly increase the volume of spent batteries available for recycling.”

Introduction

Lithium Australia NL (ASX: LIT, ‘the Company’) has a 90% ownership interest in Envirostream Australia Pty Ltd (‘Envirostream’). An onshore, mixed-battery recycling company, Envirostream is unique in Australia in its ability to collect, sort, shred and separate all the components of end-of-life lithium-ion batteries (‘LIBs’), as well as single use alkaline batteries. This makes it a perfect fit with the Company’s critical battery metal-processing expertise.

In July 2019, Victoria banned the disposal of spent batteries to landfill, given that many contain toxic materials capable of polluting soil, groundwater and waterways. As the only mixed battery recycler in Australia, Envirostream is focused on diverting as much battery material from landfill as possible, as well as improving the sustainability of the industry via the creation of a circular battery economy.

The volumes of spent batteries available for recycling is expected to increase following recent announcements by the Battery Stewardship Council that it has secured federal government and industry funding to establish an accredited process for their collection and recycling. Scheduled to commence in January 2022, the Battery Stewardship Scheme will collect a levy on each new battery sold and use the funds to subsidise the collection and processing of end-of-life batteries.

Envirostream works closely with the appropriate regulatory bodies to ensure that its management systems and safety and environmental procedures exceed industry accepted standards, thereby minimising any risk to local communities. Its focus on continuous improvement ensures that battery recycling in Australia remains safe, environmentally friendly and sustainable.

Operating Licence

In 2020, using EPA Victoria’s long-route licence pathway, Envirostream applied for an operating licence for its activity site in Berwick Road, Campbellfield, Victoria. The prescribed permission activities under section 74(1)(a) of the Environment Protection Act 2017 allow Envirostream to reprocess specified electronic waste, including batteries, at a capacity exceeding 500 tonnes per year.

That licence is valid for 99 years, subject to several conditions, including the installation of thermal-imaging cameras and firewall protection systems for the early detection and management of any fire incidents that may arise. Conditions for air emission are also stipulated.

A change-of-land-use application for the Berwick Road premises is currently in progress at the Hume City Council. Envirostream has complied with all requests for information from the council and the Company expects that this application too will be approved.