Leadership Change at Blue Whale Materials
A company that produces black mass just appointed a new CEO.
First, what do they do? Well, this links back to something I posted about last week. Blue Whale Materials produces black mass from end-of-life lithium-ion batteries.
When people talk about battery recycling, this is a stage that is often dismissed as easy. The common mental image of this step is pretty straightforward, but mechanically, it can actually be one of the most complicated stages in the entire recycling train, and it can absolutely make or break the downstream processing.
Sure, producing low-quality black mass is easy. But what Blue Whale is focusing on is ensuring that the subsequent hydrometallurgical stage can be streamlined and financially viable.
On paper, their process looks rather simplistic, and I apologize to anyone who works at Blue Whale for this over generalization, but at its core, the mechanism is essentially: poke the cell, dunk it in a tank, then bake it. This is followed by size reduction and low-value component separation.
However, if you zoom out, what you actually have is a process pulling off an incredibly delicate balancing act. They are tightly controlling emissions while simultaneously reaching the optimal level of thermal reduction and mechanical processing required to create high-quality, low-impurity black mass, a product they market as Black Sand.
One of the major challenges for any lithium-ion recycler is the ability to produce a consistent profitable product at ever-increasing levels of scale. Some studies have shown that even basic setups require a throughput of 10,000 tpa of feedstock to be profitable. This is the baseline of economies of scale, and a more advanced setup like Blue Whale’s will most likely require even more throughput to reach that positive margin level.
And this is where it seems the company has decided they need new leadership. I am not completely up to speed on the background of Mr. Jack Johnson, who will take over as CEO, but this is from the official PR about it:
He previously led the design, construction, and commissioning of one of the first large-scale lithium-ion battery manufacturing facilities in the United States and has founded and led multiple advanced materials companies.
That right there is what is so important, and what I like to refer to as the ability to transition from R&D to commercial scale. When you are able to bring in someone who has first-hand knowledge of the industry outside of a startup environment, part of the equation is finally filled out.
Blue Whale’s flagship facility in Bartlesville, Oklahoma, came online with an initial nameplate capacity of 14,000 tpa, with a proposed expansion to bring that to 20,000 tpa, and an ultimate long-term roadmap goal of 50,000 tpa of battery feedstock.
Their growth capital strategy is comprised of a senior secured credit facility from Breakwall Capital, combined with an equity commitment from Ara Partners and a $55 million grant from the U.S. Department of Energy with records showing they have utilized $7 million of that grant.
According to the partners involved, this combination of financing gives the company a balance sheet specifically built for expansion as the market demand for domestic battery materials keeps growing.
Producing black mass isn’t the only service they provide. Through their subsidiary, they also provide full-service battery testing, grading, and safety evaluations. On top of that, they manage one of the most often overlooked aspects of lithium-ion recycling, until it shows up on the evening news, the complicated logistics side of collections and transportation of spent batteries.
Blue Whale is moving past the R&D stage and positioning itself to be a commercial contributor to the developing U.S. circular supply chain. I look forward to seeing how they progress over the next few years.
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