Aqua Metals and American Battery Factory Advance Plans for a U.S. Circular Battery Materials Supply Chain

Aqua Metals (NASDAQ: AQMS) and American Battery Factory announced a proposed strategic collaboration aimed at strengthening the domestic, circular supply of battery materials in the United States. The companies signed a non-binding memorandum of understanding (MOU) to evaluate co-locating a lithium-ion battery recycling facility alongside American Battery Factory’s planned battery cell manufacturing site in Tucson, Arizona.

Under the proposal, Aqua Metals would process manufacturing scrap and third-party battery feedstock into battery-grade lithium carbonate for reuse in U.S.-based battery production. The planned facility could support up to 10,000 metric tons of annual processing capacity, creating a closed-loop system that reduces dependence on overseas refining and shortens supply chains.

Strategic Rationale

The collaboration directly addresses growing concerns around supply-chain security, cost efficiency, and sustainability in the U.S. battery ecosystem. By integrating recycling and manufacturing at a single location, the companies aim to keep more economic value onshore while lowering transportation costs and operational complexity.

In addition, the approach supports a circular manufacturing model in which battery materials are recovered, refined, and redeployed domestically rather than exported for processing abroad.

Technology and Competitive Positioning

Aqua Metals plans to apply its proprietary AquaRefining™ technology, an electricity-powered, closed-loop process designed to replace high-temperature furnaces and chemical-intensive recycling methods. The technology is intended to deliver high-purity battery materials with a lower environmental footprint, aligning with increasing regulatory and customer demand for sustainable production.

For American Battery Factory, the collaboration could provide a localized source of recycled materials, improving supply reliability while supporting U.S. manufacturing goals tied to electric vehicles and energy storage.

Investor Takeaway

While the agreement remains non-binding, the proposed collaboration highlights a shared strategic vision around domestic battery materials independence and circular manufacturing. For investors, the initiative underscores Aqua Metals’ push toward commercial partnerships and real-world deployment of its recycling platform, while positioning both companies within a key growth theme tied to electrification and energy transition.

Next steps will depend on technical, financial, and regulatory evaluations. However, if executed, the collaboration could represent a meaningful step toward building a resilient, end-to-end U.S. battery supply chain.