US-Japan Cobalt Deal Aims to Break China's Grip on Critical Minerals

YUMA, AZ – April 28, 2026 – In a landmark move to bolster American industrial independence, EVelution Energy has secured a binding $850 million offtake agreement with Japanese trading giant Mitsui & Co. to supply cobalt from its planned Arizona processing facility. The deal represents a major step in a concerted U.S. and allied effort to build a secure critical minerals supply chain outside of China's dominant control.

The five-year agreement will see Mitsui purchase a substantial majority of the cobalt metal produced at what is set to be the first commercial-scale cobalt processing facility in the United States. Located in Yuma County, the plant is a direct challenge to a glaring strategic vulnerability: over 75% of the world's refined cobalt, a mineral indispensable for modern technology, currently comes from China. The U.S., by contrast, has no domestic refining capacity of this scale.

This partnership is more than a commercial transaction; it is a clear signal of deepening industrial cooperation between the United States and Japan, two allies increasingly focused on de-risking supply chains vital to their economic and national security.

A Strategic Alliance to Reshore Supply Chains

Under the terms of the deal, EVelution Energy will supply Mitsui with up to 3,000 metric tons of cobalt metal per year. When fully operational, the Yuma facility is expected to produce an aggregate of up to 7,000 metric tons annually of both cobalt sulfate, primarily for electric vehicle batteries, and cobalt metal. This output could satisfy an estimated 40% of total U.S. cobalt demand, significantly reducing the nation's long-standing reliance on foreign, and often non-allied, processing.

“This agreement represents a strategic milestone for EVelution Energy in advancing U.S. critical mineral processing capacity,” said Navaid Alam, President & CEO of EVelution Energy, in a statement. “Establishing secure cobalt processing infrastructure in the United States is essential to strengthening the resilience of the U.S. industrial base and reducing long-term strategic dependence on non-allied refining capacity.”

The collaboration with Mitsui underscores the high strategic and commercial value placed on creating a resilient, transatlantic source for this essential material. It reflects a growing demand from industrial partners in allied nations for supply chains that are not only efficient but also secure from geopolitical disruption.

More Than Just Batteries: Cobalt's Critical Role

While the electric vehicle revolution has put cobalt in the public spotlight, its importance extends far beyond EV batteries. The cobalt metal secured by Mitsui is a critical input for a host of advanced manufacturing sectors vital to national security. It is an essential component in the superalloys required for high-performance jet engines, a key material in satellite systems, and a component in powerful samarium-cobalt (SmCo) permanent magnets used in precision guidance systems and defense applications.

This broad utility is why the project aligns with several federal initiatives, including programs under the Defense Production Act (DPA), aimed at reshoring manufacturing capabilities deemed essential for national defense. The project's filing with U.S. Citizenship and Immigration Services (USCIS) as an “expedited national security interest project” further highlights its strategic importance to the federal government.

By producing both cobalt sulfate for the green energy transition and high-purity cobalt metal for the aerospace and defense industries, the Yuma facility is positioned to serve multiple pillars of the modern American economy, insulating them from potential supply shocks and trade weaponization.

Financing a New American Industrial Base

The $850 million valuation of the Mitsui agreement, based on current market prices, provides a powerful revenue anchor for the project, but it is part of a larger, sophisticated financing strategy underwritten by a web of federal support. EVelution Energy has received a non-binding Letter of Interest from the Export-Import Bank of the United States (EXIM) for a loan of up to $200 million under its “Make More in America” initiative, a program designed to support domestic manufacturing.

Furthermore, the project is leveraging the EB-5 Immigrant Investor Program to raise up to $64.8 million in secured debt. This program links foreign investment directly to U.S. job creation. The facility’s location in a federally designated rural Qualified Opportunity Zone also provides significant long-term tax incentives, encouraging private capital to flow into economically distressed areas and support strategic domestic projects.

This multi-layered financial architecture, combining private offtake commitments with federal loan programs and investment incentives, creates a de-risked model that could become a blueprint for rebuilding America's critical industrial capacity. It demonstrates a public-private partnership aimed squarely at tackling a decades-old strategic dependency.

Yuma's Green Gamble: Economic Boom and Environmental Scrutiny

For Yuma County, the project promises a significant economic transformation. Projections estimate it will generate over $750 million in economic activity and create more than 3,300 direct, indirect, and induced jobs over its lifespan, a substantial boon for the rural community. The Yuma County Board of Supervisors unanimously approved a special use permit for the facility in 2023, signaling strong local government backing.

EVelution Energy has also put sustainability at the core of its design. The facility is planned to be powered by a 28.4-megawatt on-site solar array and is engineered to recycle approximately 70% of its process water. In a significant departure from traditional refining, the plant will produce no on-site tailings ponds; all waste will be transported to a licensed local landfill.

However, the project is not without its environmental complexities. In the arid landscape of Arizona, water is a precious resource. The facility is expected to draw up to 74 million gallons of water per month from groundwater aquifers, a figure that will likely draw scrutiny despite the high recycling rate. To address ethical concerns that have long plagued the cobalt industry, the company has also committed to sourcing its raw cobalt hydroxide feedstock primarily from suppliers in the Democratic Republic of Congo that adhere to the Responsible Minerals Initiative and other international due diligence standards.

With construction slated to begin in early 2027 and completion targeted by the end of 2029, the EVelution Energy facility is set to become a critical test case. It will demonstrate whether the United States can successfully pair ambitious economic and national security goals with the high environmental and ethical standards demanded of a modern industrial leader.