Posco Future M Company, the battery materials subsidiary of South Korea's Posco Holdings, announced that it has signed an agreement with US start-up Molten Industries Inc to produce anode materials for batteries using natural graphite made from methane gas.

The aim of the partnership is to cut the use of mined graphite in anodes, which are the key components in electric vehicle (EV) batteries that store energy. Molten Industries has developed a chemical process, called pyrolysis, that splits methane gas into hydrogen and graphite using electrical resistive heating. The company has built a graphite pilot production facility that uses this process in West Oakland, California.

The two companies have agreed to collaborate in the production of graphite from methane gas. The graphite will then be processed into a spherical form by Posco’s specialist subsidiary, Future Graph, for the production of battery anode materials.

According to the company, graphite produced from methane gas contains fewer metallic impurities than mined graphite, significantly reducing the refining process and ultimately the production cost of anode materials.