Ballard and UCAR'S Graftech Inc. Subsidiary Enter into
New Exclusive Development and Supply Agreements for Fuel
Cell Materials and Components
VANCOUVER, BRITISH COLUMBIA--JUNE 5, 2001 - 01:06 EDT
Ballard Power Systems Inc. (TSE:BLD
and NASDAQ:BLDP) and UCAR International Inc. announced today that
they have entered into a new exclusive development and
collaboration agreement and a new exclusive long-term supply
agreement for natural graphite-based materials and manufactured
components for BALLARD(R) fuel cells and fuel cell systems.
Ballard will also become a strategic investor in Graftech Inc., a
wholly owned subsidiary of UCAR, investing US$5-million for a 2.5%
ownership interest in that subsidiary, to support fuel cell
development and commercialization.
The scope of the new agreements significantly expands upon
Graftech's and Ballard's initial collaboration announced in 1999.
The development agreement, which has been extended from 2002 in
the initial collaboration to 2011, includes natural graphite-based
materials and components for use in proton exchange membrane (PEM)
fuel cells and fuel cell systems for transportation, stationary
and portable applications. The joint development program will
concentrate on the development of cost-effective graphitic
materials and components, including flow field plates and gas
diffusion layers. As a part of this arrangement, Graftech will
also develop and manufacture prototype materials and components
and provide early stage testing of these prototypes in an on-site
fuel cell testing center.
Under the supply agreement, which has been extended from 2008 in
the initial collaboration to 2015, Graftech will be the exclusive
manufacturer and supplier of natural graphite-based materials for
BALLARD(R) fuel cells, including GRAFCELL(TM) advanced flexible
graphite for use in flow field plates for Ballard's Mark 900 fuel
cell. It is Ballard's intent that Graftech be the exclusive
manufacturer of all flexible graphite-based components that
Ballard decides not to manufacture in-house.
Under the agreements, Graftech has the right to manufacture and
sell, after agreed upon release dates, natural graphite-based
materials and certain components, for use in PEM fuel cells, to
other parties. In connection with the manufacture and sale of
components, Ballard will grant Graftech a royalty-bearing license
for related manufacturing process technology.
"Graftech's advanced flexible graphite technologies and
engineering capabilities will play a significant role in
supporting the commercialization of BALLARD(R) fuel cells. As a
long-term supplier to Ballard, Graftech has demonstrated its
ability to provide us with a product that meets our needs. We are
excited to be working together with Graftech to collaborate on the
joint development of components which will allow us to further
reduce our costs, improve performance and provide increased
manufacturing capability," stated Kip Smith, Ballard's President
and Chief Operating Officer. "Ballard's equity stake in Graftech
confirms our commitment to the success of this collaboration."
Gil Playford, Chairman of UCAR, stated, "We are excited about the
opportunity to broaden our strategic role with Ballard from
supplying fuel cell materials to also include both the development
of fuel cell components with Ballard and their production. We are
very confident that the proven success of our GRAFCELL(TM)
materials in the BALLARD(R) Mark 900 fuel cell, where we have
achieved targeted performance and cost objectives for flow field
plate materials, will be replicated in our newly expanded efforts.
Graftech's new advanced flexible graphite line was installed in
anticipation of these agreements in order to meet the sales demand
of Ballard for the next 2-3 years." Mr. Playford continued, "The
new agreements position us to capitalize on the exciting long-term
growth opportunities in the emerging fuel cell market. We will
supply the industry recognized leader in PEM fuel cells and will
also have the ability to take Graftech's products to the broader
market in the long term."
Prototype fuel cell vehicles which have utilized, or will utilize,
the BALLARD(R) Mark 900 fuel cell containing Graftech's
GRAFCELL(TM) advanced flexible graphite materials include Ford's
TH!NK FC5 and DaimlerChrysler's NECAR 5 automobile and the buses
that are part of the recently announced DaimlerChrysler European
transit bus program.
UCAR International Inc. is one of the world's largest
manufacturers and providers of high quality natural and synthetic
graphite and carbon based products and services, offering energy
solutions to industry-leading customers worldwide engaged in the
manufacture of steel, aluminum, silicon metal, automotive products
and electronics. The company has 15 manufacturing facilities in 8
countries and has the largest share of the free trading markets in
all of its major product lines. UCAR produces graphite electrodes
that are consumed primarily in the production of steel in electric
arc furnaces, the steel making technology used by all
"mini-mills," and for refining steel in ladle furnaces. The
company also produces carbon electrodes that are consumed in the
manufacture of silicon metal and cathodes that are used in the
production of aluminum.
Graftech Inc. develops and manufactures flexible graphite for
gasket and sealing applications, for use in the manufacture of
flow field plates for proton exchange membrane fuel cells, for
thermal applications in computer and other electronic devices,
fire protection applications, energy management applications in
devices such as batteries and supercapacitors, and furnace
applications. GRAFCELL(TM), GRAFGuard(TM), GRAFOIL(TM),
GRAFSHIELD(TM) and eGraf(TM) are trademarks of Graftech Inc.
Ballard Power Systems is recognized as the world leader in
developing, manufacturing and marketing zero-emission proton
exchange membrane fuel cells for use in transportation,
electricity generation and portable power products. Ballard Power
Systems' proprietary fuel cell technology is enabling automobile,
electrical equipment and portable power product manufacturers to
develop environmentally clean products for sale. The fundamental
component of these end-user products is the BALLARD(R) fuel cell
that combines hydrogen (which can be obtained from methanol,
natural gas, petroleum or renewable sources) and oxygen (from air)
without combustion to generate electricity. Ballard is partnering
with strong, world-leading companies, including DaimlerChrysler,
Ford, GPU, ALSTOM and EBARA, to commercialize BALLARD(R) fuel
cells. Ballard has also supplied fuel cells to Honda, Nissan,
Volkswagen, Yamaha, Cinergy, Coleman Powermate and Matsushita
Electric Works, among others.
This release contains forward-looking statements reflecting
Ballard's current expectations as contemplated under the Safe
Harbour provisions of the US Private Securities Litigation Reform
Law of 1995. Investors are cautioned that all forward-looking
statements involve risks and uncertainties, including, without
limitation, product development delays, changing environmental
regulations, the ability to attract and retain business partners,
future levels of government funding, competition from other fuel
cell manufacturers, competition from other advanced power
technologies, competition from existing power technologies,
evolving markets for generating electricity and power for
transportation vehicles, and the ability to provide the capital
required for product development, operations and marketing. These
factors should be considered carefully and readers should not
place undue reliance on Ballard's forward-looking statements.
Investors are encouraged to review the section titled "Operating
Results, Capital Requirements and Risks" (pages 41 to 46) in the
Management's Discussion and Analysis section of Ballard's 2000
Annual Report for a more complete discussion of factors that could
affect Ballard's future performance.
Ballard's Common shares are listed on The Toronto Stock Exchange
under the trading symbol "BLD" and on the Nasdaq National Market
System under the symbol "BLDP". Ballard and the Ballard logo are
registered trademarks of Ballard Power Systems Inc. |
