Increases plant capacity to 29 GWh, based on
$1.6 billion in identified debt financing support, catalyzed by the
Norwegian National Battery Strategy and Norway’s Export Credit
Agency Eksfin’s indication of up to EUR 400 million in loans and/or
guarantees
- FREYR’s Board of Directors has sanctioned construction of Giga
Arctic (combined Gigafactories 1 & 2), the company’s first
battery manufacturing facility under development in Mo i Rana,
Norway
- FREYR is increasing the nameplate capacity of Giga Arctic to 29
GWh in response to improving battery supply-demand dynamics,
ongoing commercial success, significant progress in developing
supply chain channels for key raw materials and equipment,
continued technical and product improvements, and project financing
visibility
- Earlier today at FREYR’s development site in Mo i Rana, the
Norwegian Government outlined its National Battery Strategy, which
includes significant support from Export Finance Norway (“Eksfin”)
to assist FREYR with project financing of Giga Arctic
- FREYR has identified total debt financing support of over $1.6
billion based on visibility from export credit agencies,
multilateral development finance institutions and commercial
banking partners, exceeding management’s leverage target for the
$1.7 billion estimated total capital cost for the expanded Giga
Arctic project
- FREYR intends to contract approximately 50% of Giga Arctic’s
capacity to long-term offtake partners and reserve the remaining
volumes to address exponentially growing market demand, providing
annual revenue generating capacity of $2 billion upon optimization
of production systems and cell chemistry
- Giga Arctic is expected to be one of the largest and most
efficient battery facilities in Europe, with 50% lower anticipated
capital spending per GWh of nameplate capacity and more than 200%
higher production per employee than conventional Lithium-Ion
battery plants in production today
- FREYR is raising its installed annual production capacity
target to more than 200 GWh by 2030, twice the company’s previous
ambition
- FREYR has recently secured a conditional offtake agreement
(“COA”) with a major European energy technology customer for 25 GWh
of battery cells from 2024 to 2028, in addition to the more than
100 GWh of previously announced COAs
FREYR Battery (NYSE: FREY) (“FREYR”), a developer of clean,
next-generation battery cell production capacity, announced today
that the company’s Board of Directors (“The Board”) has approved
the expansion of the planned Giga Arctic project under development
in Mo i Rana, Norway, to an annual nameplate capacity of 29 GWh.
FREYR’s Board of Directors has also approved the construction of
Giga Arctic. The approval follows substantial completion of
detailed plant engineering; the establishment of procurement
frameworks with key raw material and capital equipment suppliers;
and the announcements of conditional offtake agreements totaling
more than 125 GWh from the planned start of production in 1H-2024
through 2030. Groundworks at the site are well advanced and the
company has recently started casting foundation structures.
The Board’s decision coincides with the announcement of a letter
of intent indicating loans and/or guarantees of up to €400 million
from Eksfin, Norway’s export credit agency (“ECA”), and the
recently announced National Battery Strategy by the Norwegian
Government, which outlines meaningful governmental support for the
developing battery industry in Norway.
“If we are to reach the goals in the Paris agreement, batteries
will need to be produced in a more sustainable way with the lowest
CO2 footprint possible. It is therefore important for Norway to
define a clear direction and set ambitious goals for battery
production in our country. The National Battery Strategy that we
just launched, defines ten areas of key importance that will
facilitate private investments so that companies along the entire
value chain can set up sustainable and successful businesses in
Norway. Our unmatched access to renewable energy makes batteries
produced in Norway the greenest in the world. I am therefore very
pleased and excited that FREYR Battery is moving along with its
plans to establish a Gigafactory in Norway based on state capital
and risk relief. It is an important confirmation that public and
private partnerships are important to be successful in creating the
green industry of the future,” said the Minister of Trade and
Industry, Jan Christian Vestre.
“Today marks another significant milestone for FREYR on our path
to giga-scale production of clean battery solutions. With our
expanded plant capacity, accelerating commercial momentum, and
strong support from Eksfin, other ECAs and financial institutions,
Giga Arctic represents one of Norway’s largest industrial
investments onshore in recent decades,” said Torstein Dale
Sjøtveit, Founder and Executive Chairman of FREYR.
Governmental Support and Gigafactory
Financing Plan
Today, the Norwegian Government announced the key elements of
its National Battery Strategy at FREYR’s facilities in Mo i Rana,
Norway. With the expected financial backing catalyzed by this
strategy and support from other European governmental entities,
FREYR has identified over $1.6 billion of potential debt financing
support to fund development of Giga Arctic, including:
- A letter of intent received from Eksfin indicating loans and/or
guarantees of up to €400 million;
- Anticipated loan guarantees exceeding $800 million from ECAs of
three OECD countries based on capital equipment order frameworks
for Giga Arctic from the same plant equipment suppliers to FREYR’s
Customer Qualification Plant;
- Indications of support received from multilateral development
finance institutions, which include potential loans of $300 million
from the European Investment Bank (“EIB”) and $50 million to $100
million from the Nordic Investment Bank (“NIB”), respectively;
and
- Targeted project financing from a consortium of commercial
banks led by initial mandated lead arrangers Societe Generale and
DNB, which are now formally launching the project financing
process.
In addition, FREYR had $523 million of cash on its balance sheet
as of March 31, 2022, and currently has multiple grant applications
pending decision.
Tone Lunde Bakker, Chief Executive Officer of Eksfin, added,
“Export Finance Norway's most important task is to offer capital
and risk relief to the green, Norwegian export industry. Long-term
partnerships between state and private capital are needed to
realize the transition to a zero-emission society; create local
jobs; and take leading positions internationally. FREYR Battery’s
factory can play a key role in building a powerful, high-tech value
chain within batteries in Norway and the Nordic countries. Eksfin
has therefore indicated participation in the financing of the
project in collaboration with other financiers and investors. We
wish FREYR good luck in the next, exciting phase and look forward
to working closely with the growing Norwegian battery
industry.”
Giga Arctic Development
The sanctioned Giga Arctic construction project includes eight
production lines, a battery testing center, administrative
facilities, and infrastructure at an estimated total capital cost
of $1.7 billion. The updated cost relative to FREYR’s initial
business plan, which was finalized in February 2021, is
attributable to the following:
- A 150% increase in nameplate capacity on a chemistry equivalent
basis to 29 GWh from the initial plan to construct two smaller
Gigafactories in Mo i Rana1;
- Technical modifications and enhancements to the plant and its
products that are intended to improve operational efficiency and
economic returns; and
- Inflationary pressures and supply chain challenges.
FREYR has engineered and positioned Giga Arctic to be the most
capital efficient battery plant in Europe, with 50% lower estimated
capital expenditures per installed GWh of capacity compared to
plants currently in operation or under construction. The company
also expects Giga Arctic to be the most operationally efficient
battery plant in Europe, generating an anticipated 200% higher
production per plant employee compared to estimated averages at
conventional Lithium-Ion battery facilities. These expected
efficiencies are aided by FREYR’s recently announced long-term
power purchase agreement (“PPA”) with Statkraft. Giga Arctic is
expected to benefit from 100% renewable energy at prices that FREYR
estimates to be substantially below those of other battery
producing regions, while using less energy in production through
the 24M Technologies SemiSolidTM cell manufacturing process and
platform.
FREYR is also evaluating additional enhancements to the Giga
Arctic development that include module and pack manufacturing,
recycling and other applications which could add approximately $250
million of additional capital expenditures. Management expects the
above investments to generate highly accretive returns on capital
for the project should the company move forward with these
initiatives. In addition, the company continues to evaluate its
proposed joint venture with Aleees for a Nordic LFP cathode
materials manufacturing plant.
Tom Einar Jensen, FREYR’s Chief Executive Officer, concluded,
“Since our NYSE listing in July 2021, FREYR has made incredible
progress on its goal of providing clean battery solutions to the
world through speed, scale, and sustainability. Despite supply
chain challenges and inflation, the fundamentals have never been
better for the battery industry given the largest secular shift in
human history towards the energy transition to address the climate
emergency; the immediate need for energy security, localized power
generation and storage; and the accelerating adoption of electric
vehicles and battery energy storage systems. FREYR is playing a key
role in addressing energy cost inflation, energy security and
climate change.”
1 Gigafactories 1 & 2 were initially expected to produce NMC
battery cells
***
About FREYR Battery
FREYR Battery aims to provide industrial scale clean battery
solutions to reduce global emissions. Listed on the New York Stock
Exchange, FREYR’s mission is to produce green battery cells to
accelerate the decarbonization of energy and transportation systems
globally. FREYR has commenced building the first of its planned
factories in Mo i Rana, Norway and announced potential development
of industrial scale battery cell production in Vaasa, Finland, and
the United States. FREYR intends to deliver up to 43 GWh of battery
cell capacity by 2025, over 83 GWh of annual capacity by 2028 and
over 200 GWh of annual capacity by 2030. To learn more about FREYR,
please visit www.freyrbattery.com
Cautionary Statement Concerning Forward-Looking
Statements
All statements, other than statements of present or historical
fact included in this press release, including, without limitation,
statements regarding (i) FREYR’s anticipated path to
commercialization and giga-scale production of clean battery
solutions; (ii) the development, timeline, capacity and other
usefulness of the Giga Arctic project, including annual revenue
generating capacity of $2 billion upon optimization of production
systems and cell chemistry; (iii) the realization of FREYR’s
capital spending plan; (iv) the progress and development of FREYR’s
customer relationships and offtake agreements and supply chain
partnerships, including the entry into any successful joint
ventures with Aleees and FREYR’s intent to contract approximately
50% of Giga Arctic’s capacity to long-term offtake partners and
reserve remaining volumes to address exponentially growing market
demand; (v) the success of any capital raising paths to fund
FREYR’s planned expansion; (vi) FREYR’s ability to convert any
conditional agreements, letters of intent, anticipated loan
guarantees, indications of support from multilateral development
finance institutions and targeted project financing into definitive
agreements; (vii) the status of FREYR’s mission to establish over
200 GWh of annual capacity by 2030 and its anticipated total
conditional offtake volumes exceeding 125 GWh through 2030; (viii)
the success and impact of any support from the Norwegian government
for the developing battery industry in Norway; (ix) the success of
FREYR’s accelerated commercial momentum; (x) the success of any
anticipated debt financing support to FREYR to fund the development
of Giga Arctic; (xi) the success of any transition to a
zero-emission society and the role of FREYR’s factory in building a
powerful, high-tech value chain within batteries in Norway and the
Nordic countries; (xii) the ability of any technical modifications
and enhancements to Giga Arctic and its products to improve
operational efficiency and economic returns; (xiii) Giga Arctic’s
status as the most capital efficient battery plant in Europe (and
its 50% lower estimated capital expenditures per installed GWh of
capacity compared to plants currently in operation or under
construction); (xiv) Giga Arctic’s status as one of the largest and
most operationally efficient battery plant in Europe, generating an
anticipated more than 200% higher production per plant employee
compared to estimated averages at conventional Lithium-ion battery
facilities in production today; (xv) the expected efficiencies
supported by any long-term power purchase agreements that FREYR has
announced, including with Statkraft, and any expected benefits from
100% renewable energy at prices that FREYR estimates to be
substantially below those of other battery producing regions as a
result of such agreements; (xvi) the development and
commercialization of 24M Technologies, Inc.’s SemiSolidTM
technology, including the use of less energy in production through
such technology; (xvii) FREYR’s manufacturing capacity relative to
other market participants; (xviii) the ability for any additional
enhancements to the Giga Arctic development that could add
approximately $250 million of additional capital expenditures or
may generate highly accretive returns on capital for the project
should FREYR move forward with these initiatives; (xix) FREYR’s
progress towards its goal of providing clean battery solutions to
the world through speed, scale and sustainability; (xx) the status
of the largest secular shift in human history towards energy
transition to address the climate emergency; (xxi) the immediate
need for energy security, localized power generation and storage;
(xxii) the accelerating adoption of electric vehicles and battery
energy storage systems; and (xxiii) FREYR’s role in addressing
energy cost inflation, energy security and climate change are
forward-looking and involve significant risks and uncertainties
that could cause the actual results to differ materially from the
expected results.
Most of these factors are outside FREYR’s control and difficult
to predict. Information about factors that could materially affect
FREYR is set forth under the “Risk Factors” section in (i) FREYR’s
Registration Statement on Form S-1 filed with the Securities and
Exchange Commission (the “SEC”) on August 9, 2021, as amended, and
(ii) FREYR’s annual report on Form 10-K filed with the Securities
and Exchange Commission on March 9, 2022, and available on the
SEC’s website at www.sec.gov.
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version on businesswire.com: https://www.businesswire.com/news/home/20220629005440/en/
Investor contact: Jeffrey Spittel Vice President,
Investor Relations jeffrey.spittel@freyrbattery.com Tel: (+1)
281-222-0161 Media contact: Katrin Berntsen Vice President,
Communication and Public Affairs, FREYR
katrin.berntsen@freyrbattery.com Tel: (+47) 920 54 570
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