Tesla is reportedly in talks to secure a nickel supply for batteries produced in a carbon-neutral way from a Canadian mining company called Giga Metals.

During Tesla’s last earnings call in July, CEO Elon Musk pleaded with mining companies to increase their nickel production:

Well, I’d just like to re-emphasize, any mining companies out there, please mine more nickel. Okay. Wherever you are in the world, please mine more nickel and don’t wait for nickel to go back to some long — some high point that you experienced some five years ago, whatever. Go for efficiency, obviously environmentally friendly nickel mining at high volume. Tesla will give you a giant contract for a long period of time, if you mine nickel efficiently and in an environmentally sensitive way. So hopefully this message goes out to all mining companies. Please get nickel.

Now, we learned about Tesla being in talks with a mining company to secure some nickel.

Reuters reports that Tesla is currently discussing a nickel supply deal with Giga Metals in Canada:

“Tesla Inc. is in discussions with Canadian miner Giga Metals about helping to develop a large mine that would give the electric vehicle maker access to low-carbon nickel for its batteries, three people familiar with the matter said.”

Giga Metals, which sounds like a name made up to attract Tesla, has an early-stage mining project in development in north-central British Columbia with measured resources of 5.2 billion pounds of nickel and 312 million pounds of cobalt.

What is most interesting is that Giga Metals is developing the project to extract the mineral in a way that is sustainable and carbon-neutral with hydropower.

Neither Tesla nor Giga Metals confirmed the talks, but Giga Metals President Martin Vydra commented:

“Giga is actively engaged, and has been for some time, with automakers regarding our ability to produce carbon-neutral nickel.”

After the report came out today, Giga Metals’ stock price almost doubled, and the company issued a statement with Vydra adding:

“Giga Metals has been mentioned in recent media articles as they pertain to ongoing efforts to advance the Turnagain deposit to commercialization. What I can say is that there is no material announcement forthcoming and we will keep regulators and investors informed of any material changes that require disclosure in accordance with securities regulations.”

The project is still in very early stages, and it would require over $1 billion to complete it.

Tesla hasn’t been known to support many junior mining companies with early contracts pre-production. Instead, the automaker partnered with major mining companies like Glencore and Ganfeng Lithium.

However, Tesla did enter a conditional supply agreement back in 2015 with Pure Energy Minerals, which has claims on 9,500 acres of lithium brine in Clayton Valley — just a four-hour drive from the Tesla Gigafactory, but the mining company has yet to enter a production phase.

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