Anglo American has signed a binding agreement with First Mode Holding Inc (“First Mode”) to combine Anglo American’s nuGen™ Zero Emissions Haulage Solution (“ZEHS”) with First Mode, the specialist engineering technology company that partnered with Anglo American to develop the nuGen™ ZEHS (the “Transaction”).

The Transaction, first indicated in June 2022, is intended to accelerate the development and commercialisation of Anglo American’s nuGen™ ZEHS. Anglo American acquired a 10% strategic equity interest in First Mode in 2021. The Transaction includes Anglo American making an additional capital investment of $200 million in the combined business to help fund the ongoing development of ZEHS which, upon completion of the Transaction, values the business in the order of $1.5 billion and results in Anglo American owning a majority shareholding in First Mode. The balance of the equity interest at that time will be held by a number of First Mode’s founders and employees.

Upon closing of the Transaction, expected in January 2023, Anglo American will enter into a supply agreement with First Mode to decarbonise its global fleet of ultra-class mine haul trucks, of which approximately 400 are currently in operation, in support of Anglo American achieving its 2040 target for carbon neutral operations. The roll-out across Anglo American’s haul truck fleet over the next c.15 years is subject to the completion of agreed and committed studies across seven mine sites, certain performance and cost criteria, and relevant regulatory, corporate and shareholder approvals. The supply agreement also includes the appropriate provision of critical supporting infrastructure such as refuelling, recharging, and facilitation of hydrogen production.

Anglo American also recognises its role in supporting broader decarbonisation objectives outside its own business. The technologies and capabilities that it has been developing as part of the nuGen™ project with First Mode present opportunities beyond Anglo American’s haul truck fleet, including across other industries that rely on heavy duty forms of transport, such as rail.

In addition to accelerating the development and commercialisation of the ZEHS technology, the new combined business will allow strategic third parties to co-invest alongside Anglo American and First Mode, offering the opportunity to accelerate their own decarbonisation and participate in the potential offered by the clean ZEHS technology.

The new combined business retains the First Mode name and will prioritise developing nuGen™ ZEHS, building on three years of extensive development by Anglo American and First Mode.