Beowulf Mining, a UK-based mining and development company, and graphite producer Epsilon Advanced Materials have signed a memorandum of understanding (MoU) with the City of Vaasa in Finland to establish an anode materials production facility.

The MoU follows a related agreement in December 2021 between Beowulf's subsidiary Grafintec and Epsilon Advanced Materials to build the facility.

The update means the parties will build the facility in Plot 18 of the GigaVaasa industrial area, near Freyr Battery's proposed battery cell development.

It gives them exclusive rights to Plot 18 for a possible 12 months to develop the facility, conduct technical and environmental studies, and initiate permitting discussions with Finnish authorities.

Under the December 2021 agreement, Grafintec and Epsilon Advanced Materials will work together to build the facility with the ambition of creating a "sustainable value chain" in anode materials production, leveraging renewable power, targeting net zero CO2 across the supply chain.

It will be built in two phases; the first phase will result in an annual capacity of 10,000 tonnes, with the second phase adding another 40,000 tonnes annually.

The facility will supply battery/cell manufacturing companies in Europe, complementing Epsilon Advanced Materials' growing anode materials business in India, Beowulf said.

Vikram Handa, managing director of Epsilon Advanced Materials Private, described the signing of the MoU as "a significant step forward" in advancing technology and know-how of producing "high-quality anode materials for the lithium-ion battery industry to Europe."

"We believe that a production facility situated in the emerging battery cluster in the GigaVaasa area will enable us to provide our customers in Europe with high quality and sustainable products, enhanced service levels, and give us a competitive cost structure," Handa said.