Vale has officially signed a supply deal with electric vehicle manufacturer Tesla, meaning nickel mined at Voisey's Bay in northern Labrador could end up in batteries for the next generation of electric cars.
The deal was first reported by Bloomberg in March, when Vale Canada announced plans to supply nickel to Northvolt AB, a Swedish battery manufacturer and the largest integrated battery maker in Europe.
About five per cent of nickel production in Canada already goes into electric vehicles, but Vale plans to increase its production share to between 30 and 40 per cent as it expands into the electric vehicle industry, according to a news release.
Vale wouldn't say how much the deal is worth when contacted by CBC News, declining an interview to elaborate on further details.
In an emailed statement, Vale Newfoundland and Labrador said the deal is an important partnership as they continue to pivot into the electric vehicle sector.
Vale said it's low-carbon nickel will be key in the future production of electric vehicles as global demand increases.
According to a news release, rounds from Vale's nickel refinery in Long Harbour had a verified carbon footprint of 4.4 tonnes of carbon dioxide equivalent per tonne of nickel in 2020. By comparison, pellets and powder from the Copper Cliff Nickel Refinery in Ontario had a verified footprint of 7.3 tonnes equivalent.
Emissions at Voisey's Bay are expected to rise in the short term as new underground deposits are developed, but Vale said it is necessary to reduce its greenhouse gas footprint in the long term.
In addition to Voisey's Bay, Vale also operates nickel mines in Manitoba and Ontario.