Christel Bories (Eramet) : Eramet publie des "résultats historiques" en 2022

Actually, the 2022 results are due to a lot of work and a significant repositioning of Eramet on its key assets, especially the mining assets that are at the forefront, like nickel. We operate, and you should know, we operate the largest nickel mine in the world in Indonesia. It produced 21 million tons last year, a doubling from the previous year. We plan to increase by another 50% to 30 million tons next year. So it's a huge asset, very well positioned with a lot of potential. We operate in Gabon the largest manganese mine in the world, which has also increased production by more than 80% over the past five years. So we have assets that are extremely well positioned with a lot of potential, extremely cash-generating. And it's on these assets that we have repositioned ourselves. So it's a lot of work on restructuring, productivity, growth. And we clearly benefited in the first half of 2022 from a very favorable price environment. These historical results are the best Eramet has ever published. Prices have since fallen on these raw materials, as we saw with Nathan earlier in the news. The market has stabilized. We clearly had two periods last year: a very strong first half in terms of prices, and then a much more difficult second half with a decline in raw material prices and, at the same time, a very strong increase in energy prices and the price of reductants for us, all carbon-based products. That created a margin squeeze in the second half, so our second-half results were less good than the first half. But overall, we enter 2023 with a company that is debt-free, much stronger, much more solid to accelerate in the energy transition.

So in 2023, a significant portion will still go to Gabon to continue ramping up manganese, which is today a very large source of profit for the group, both in the railway line and in the mine. And then we have lithium ramping up. We are building our first plant in Argentina, which should be in production by early 2024. You want to double production. So we will spend a bit. We have a partner who partially finances this first phase. But lithium demand is increasing with each supply. We have decided to accelerate on phase 2, and we are studying the capacity. We had a first tranche of 24,000 tons, we want to add 50,000 tons. Studies are underway, and the investment decision should be taken before the end of the year.

We are doing everything to be a global leader. We already have a fairly leading position, especially in methods for the energy transition. The lithium deposit I mentioned in Argentina, which belongs to us, is the third largest lithium deposit in the world. So we have assets that position us among the largest in the businesses we have chosen. There has clearly been a realization in Europe. COVID, the war in Ukraine, etc., have accelerated awareness of the criticality of certain raw materials for Europe and for Europe's future, sovereignty issues. So mechanisms are being put in place, notably at the European level. Thierry Breton, the Critical Raw Materials Act is being set up. There is a raw materials alliance at the European level. But Europe, as often, does not move very fast, and we need to accelerate both in financing tools for the acquisition of raw materials and in economic diplomacy. I care a lot about that because we see what other states do by forging alliances. Raw materials are not necessarily located on European territory, very little on European territory. Lithium, for example, 60% of global reserves are in a small triangle: northern Argentina, northern Chile, southern Bolivia. It's called the lithium triangle. 60% of reserves are there. We have to go get the material where it is. We need to weave political and economic agreements with the countries that hold these materials.

We are really at the very beginning. We are in what we call pre-feasibility phases with Électricité de Strasbourg. But the volume potential is not huge, since we are talking about tons, and moreover, we need to connect several wells to reach 10,000 tons of lithium because the brines found in Alsace are not very concentrated in lithium. Whereas we are talking about making 75,000 tons in the very next years in Argentina. But it is still key because we will have completely green lithium with geothermal energy, since we use geothermal. So we are almost a creditor of these two. We will sell heat, we will sell lithium. The lithium will not need to cross the planet to reach Europe, right next to European battery manufacturers. So in fact, we will be able to supply, just with this first plant, about 500,000 electric cars in France with completely green and completely French lithium. So I think that has real interest. We were talking about sovereignty, we see all these issues of sovereignty of production.

That's why, because we generated enormous cash flow in 2022, we were very debt-free, so we approach 2023 much more serenely with a much stronger balance sheet, which allows us to accelerate in projects for the energy transition and to finance the projects we talked about: lithium, nickel, cobalt, recycling. We haven't talked about battery recycling, but we also have projects in recycling, it's important. So the projects we just discussed, we have the means to finance them. We obviously have other ideas. We do exploration, like any good miner. We do exploration in Chile, we do exploration again in Indonesia on nickel. So we will have other projects, and indeed we will need to find the means to finance them. There are many tools. We are open. For the moment, we have the means to finance the projects on the table. We just need to deliver them.

Today we are at the industrial pilot stage. We did the R&D phase, we are at the industrial pilot stage. We have a partnership with Suez. The idea is first to build an industrial unit that will produce what we call black mass, the first step of dismantling, grinding, extraction, etc. And then Eramet plans to build a refining plant that will transform this black mass and extract all the battery metals and output them in battery-grade quality. That is very important because today recycling often degrades the metal, and the metal cannot be reused in its original function. Our entire process allows us to produce lithium, nickel, cobalt in battery grade that can return in a short loop into batteries. So the idea is also to position ourselves on the Dunkirk hub, where there should be battery manufacturers, which would allow us to be very close to our customers. And at the European level, are we lagging behind or are we rather proactive? I think on recycling, the entire sector is structuring itself. There are quite a few recycling projects underway. And it's very important because we will need, as you know, a lot of metals for the energy transition, enormous amounts. So these metals obviously need to be extracted responsibly and frugally, and that's where Eramet is particularly well positioned. You know we are among the leaders in our sector in everything related to CSR and responsible mining. And then once extracted, they must be recycled, not allowed to go away, and we must ensure efficient recycling. And there, Europe has rather taken the turn.

That's true, but we think that customers in the long term will be willing to pay a premium for responsible products.