NextSource Materials (OTCQB: NSRCF) hosted a November 25, 2025 site visit at a secured industrial building in ICAD, Abu Dhabi, for its first commercial‑scale Battery Anode Facility (BAF). The 30,000‑ton‑per‑year UAE BAF was validated by an October 1, 2025 technical and economic study and is intended to supply a binding multi‑year off‑take of roughly 9,000 tpa of intermediate anode material to Mitsubishi Chemical Corporation. Stantec is advancing the front‑end engineering and design (FEED); long‑lead equipment procurement and initial shipments have begun. The project targets installation and commissioning toward the end of 2026 with initial production slated for Q4 2026, subject to final funding and permitting.
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Positive Highlights
- Facility capacity of 30,000 tpa confirmed by the October 2025 study
- Binding multi‑year off‑take of ~9,000 tpa with Mitsubishi Chemical
- Long‑lead equipment procurement and shipments underway
- FEED advanced with engineering partner Stantec and UAE‑compliant plant design
Key Risks
- Project progress hinges on securing final investment commitments
- Operating permits must be obtained before installation and commissioning
- Targeted initial production date (Q4 2026) remains conditional
TORONTO, ON – November 27, 2025 – NextSource Materials Inc. (TSX: NEXT) announced that its senior leadership successfully hosted a comprehensive site visit on November 25, 2025, to the property and industrial building earmarked for its first commercial‑scale Battery Anode Facility (BAF) in the Industrial City of Abu Dhabi (ICAD), United Arab Emirates.
The visit brought together a select delegation of global and regional investors, sovereign‑linked stakeholders, and major financial institutions currently evaluating participation in NextSource’s strategic funding round. Delegates toured the secured industrial building, reviewed the phased development plan, and discussed timelines for installation, commissioning, and the start of active anode material production for lithium‑ion batteries used in electric vehicles.
Hanré Rossouw, President and CEO, stated: “We were delighted to welcome potential funding partners to our Abu Dhabi property to showcase the scale and readiness of the facility. The secured building in ICAD provides a high‑quality, installation‑ready platform, strategically located near deep‑water ports that serve international shipping routes.”
Strategic Implications for the Battery Supply Chain
The UAE BAF is a cornerstone of NextSource’s vertical integration strategy, positioning the company to become the largest anode producer outside of Asia. By locating a large‑scale facility in the Gulf, NextSource can capitalize on several competitive advantages:
- Geographic Proximity to Raw Materials: The Gulf region offers relatively short logistics to graphite concentrate from the Molo project in Madagascar and to downstream markets in Europe, the United States, and Asia.
- Port Infrastructure: ICAD’s deep‑water ports enable efficient export of intermediate anode material and import of critical processing chemicals, reducing freight costs and lead times.
- Regulatory Environment: The United Arab Emirates provides an expedited permitting process and incentives for high‑technology manufacturing, lowering the time‑to‑market for new capacity.
- Supply‑Chain Resilience: Diversifying anode production away from traditional Asian hubs mitigates geopolitical risk and supports OEM demand for stable, traceable supply chains.
Commercial Outlook and Financial Considerations
The 30,000‑tpa facility, validated by the October 2025 technical and economic study, offers immediate capacity to meet Mitsubishi Chemical’s off‑take of 9,000 tpa and leaves significant headroom for additional contracts. Preliminary economics indicate a capital expenditure (CAPEX) of approximately $450 million, with an estimated internal rate of return (IRR) in the high‑teens, driven by robust margins in the anode market and the premium associated with traceable, low‑impurity graphite.
Key financial milestones include:
- Securing final stage financing – projected to be sourced from a combination of equity partners, sovereign wealth funds, and export credit agencies.
- Completion of FEED by Q2 2026 – Stantec is delivering a design that aligns with UAE environmental and safety standards while incorporating modular expansion capability.
- Long‑lead equipment procurement – shipments of core processing units (e.g., high‑temperature furnaces, spheronization lines) have already begun, reducing risk of schedule overruns.
- Permit acquisition – operating permits are expected by mid‑2026, contingent on environmental impact assessments (EIA) and local compliance reviews.
Technology and Operational Highlights
NextSource’s BAF will employ proven, low‑impurity graphite processing technology that shortens qualification times compared with greenfield designs. The plant will produce coated, spheronized, and purified graphite suitable for high‑energy lithium‑ion cells, aligning with the performance specifications demanded by leading automotive OEMs.
By leveraging its Molo graphite concentrate – the only source of SuperFlake® graphite – the BAF can achieve a higher tap density and lower charge‑transfer resistance, translating into measurable vehicle range gains for EV manufacturers.
Next Steps
Following the site visit, NextSource has entered advanced discussions with several potential investors from the delegation. The company anticipates finalizing its financing package by early 2026, after which it will complete procurement of remaining plant equipment, commence installation, and move toward commissioning by the end of 2026.
Initial production is targeted for Q4 2026, with a planned ramp‑up to full capacity through 2027, positioning the UAE BAF as a pivotal node in the global anode supply chain.
About NextSource Materials Inc.
NextSource Materials Inc. is a Toronto‑based battery materials company focused on building a vertically integrated global supply chain for graphite and related battery‑grade materials. Its flagship Molo graphite project in Madagascar houses one of the world’s largest and highest‑quality graphite resources, including the unique SuperFlake® material. The company is developing a network of Battery Anode Facilities (BAFs) to deliver processed graphite to battery manufacturers on a transparent, traceable basis.
FAQ
What capacity will NextSource’s UAE BAF have and when is it expected to start production?
The UAE BAF is sized at 30,000 tpa according to the October 1 2025 study, with initial production targeted for Q4 2026, subject to funding and permitting.
How much material will NextSource supply to Mitsubishi Chemical under the off‑take agreement?
NextSource is the sole supplier of approximately 9,000 tpa of intermediate anode active material to Mitsubishi Chemical under a binding multi‑year agreement.
What progress has been made on construction and equipment for the UAE BAF?
Front‑end engineering and design with Stantec is underway, long‑lead equipment procurement is in progress, and shipment of processing equipment has commenced.
What remaining conditions must be met before the UAE BAF can be commissioned?
The company must secure final‑stage financing and obtain required operating permits before completing procurement, installation, and commissioning.
Why did NextSource host investors in Abu Dhabi for the site visit?
The visit showcased the secured ICAD building, proposed phased development, timelines for installation and commissioning, and engaged potential funding partners evaluating participation.
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