Lithium project developer Patriot Battery Metals has completed a private placement, raising C$69-million through a strategic investment from Volkswagen. The investment gives the German automotive giant a 9.9% stake in Patriot’s issued and outstanding common shares on a non-diluted basis.

The funds will support exploration, development, and the completion of a feasibility study for Patriot’s Shaakichiuwaanaan lithium project in Quebec, Canada. Additional proceeds will be allocated for general corporate purposes and working capital needs.

Patriot CEO and MD Ken Brinsden welcomed Volkswagen’s involvement, describing it as pivotal for the TSX- and ASX-listed company’s growth. He stated that the firm is pleased and proud to welcome Volkswagen as a strategic shareholder, noting that their investment represented a significant step forward for Patriot while working towards the delivery of one of the more important lithium raw materials projects globally.

Brinsden said Shaakichiuwaanaan was a high-grade and large-scale lithium resource that was well-placed to help meet the demand growth for lithium that was forecast through to the end of this decade and beyond, while contributing to the growth of key western supply chains.

Brinsden said Patriot would closely collaborate with Volkswagen and its battery manufacturing subsidiary, PowerCo SE.

The partnership includes several agreements aimed at bolstering the strategic alignment between the two companies. Patriot will supply 100 000 t/y of spodumene concentrate to PowerCo SE for a ten-year term under a binding offtake agreement. Volkswagen has also gained rights to participate in future equity raises by Patriot and a voting support covenant for management, subject to customary conditions, under an investor rights agreement.

Further, a memorandum of understanding aims to establish a strategic relationship between PowerCo and Patriot, focusing on shared objectives such as creating a cost-competitive, sustainable, and environmental, social and governance-compliant battery supply chain. The memorandum also explores the potential for government-backed incentives and the development of a chemical conversion facility.