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General Motors Co. GM-N and South Korea’s POSCO Chemical announced a deal to build a plant in Quebec to produce material for batteries to be used in electric vehicles (EV).

The companies say the new facility in Becancour, Que., will cost US$400-million.

It will produce cathode active materials (CAM) for GM’s Ultium batteries.

“It is so exciting to see GM Canada and Quebec playing a key role in building the emerging ‘mines to mobility’ EV battery ecosystem in North America,” Scott Bell, president and managing director of GM Canada, said in a news release.

CAM consists of processed nickel, lithium and other materials, and will ultimately help power electric vehicles such as the Chevrolet Silverado EV and GMC Hummer EV.

CAM represents almost 40 per cent of the cost of every EV battery.

Site preparation and construction are scheduled to begin immediately and will create around 200 jobs.

This announcement comes after GM and POSCO agreed to form a CAM processing joint venture in December and build a factory in North America.

The companies also say the site will be built to allow for future expansion. In November, POSCO announced plans to acquire a 15 per cent stake in Chinese EV battery material producer Inner Mongolia Sinuo New Material Technology Co.

Quebec was chosen for this facility because of several advantages, according to David Paterson, vice president of corporate and environmental affairs at GM Canada.

“Quebec’s low greenhouse gas (GHG), low-cost electricity is really important,” he said in an interview. “In addition to its environmental standards, great logistics links and a well-educated work force are some of the other reasons why we chose Quebec.”

GM is also gearing up to launch Canada’s first full electric vehicle manufacturing plant in Ingersoll, Ontario, later this year.

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