CellCore Technologies has signed a memorandum of understanding on a strategic partnership within energetics with Swedish company Verkan AB. The partnership focuses on the exchange of knowledge and experience related to the production of energetics such as nitrocellulose, strengthening security of supply for both countries and their allies. Canada and its allies are today dependent on a limited number of foreign suppliers of nitrocellulose and critical input materials for the defence industry.
By building relationships with partners who share the ambition of strengthened sovereign and allied capability, CellCore aims to contribute to greater security of supply across the entire value chain.
"This partnership is an important step in building next-generation sovereign manufacturing capacity. By sharing knowledge and experience with Verkan, we strengthen not only our own capability but the resilience of our allies. Strong domestic capacity is not just an economic advantage, it is a strategic imperative," says David Brough, CEO of CellCore Technologies.
"This is an important milestone in Verkan's establishment process. With this, we take further steps towards a more secure supply and greater sovereign control over critical input materials, contributing to a robust and resilient defence capability for Sweden and Canada," says Hugo Carlsson, CEO of Verkan.
Verkan is a Swedish company founded in 2024 with the aim of strengthening Sweden's defence capability by securing the manufacture of propellants and other central input materials, as a complement to existing industry.
About CellCore Technologies
CellCore is being developed to build next-generation sovereign manufacturing capacity for nitrocellulose and energetics for Canada and its allies. The company was founded to address strategic gaps in Canada's defence industrial supply chain, and combines deep technical expertise with a commitment to research, sovereignty, and environmental responsibility. Read more: https://cellcoretechnologies.com
About Verkan AB
Verkan is a Swedish company founded in 2024 with the aim of strengthening Sweden's defence capability by securing the manufacture of propellants and other central input materials, as a complement to existing industry. Operations will begin only once the necessary preliminary studies and preparations have been completed, all required permits have been obtained, and financing has been secured. Verkan is owned by Wallenberg Investments.
Read more at https://verkanab.se/
Noah Note: Talk about a Swedish-Canadian Dream Week lol. If there was ever a time to show off the fledgling relationship, it's now. Between the recent Strategic Partnership, Swebor and Roshel, Sweden joining the Global Coalition on Telecommunications (GCOT), Saab's Canadian expansion, and now this? Hard to see a world where Sweden doesn't take the lead as one of our major diversification partners.
For CellCore this is a wonderful move. I have had a chance to speak before to the team at CellCore, and was very impressed by both the speed and scale at which they're moving and the company's eagerness to build up a proper energetics ecosystem out West. There is no shortage of demand for propellants and rocket motors, far from it.
And while the Feds' focus has been on establishing an existing Nitrocellulose line with GD-OTS, our Munition Supply Program partner, there will always be an argument for having alternative, scalable supplies available in other places across the country. CellCore has been working to do that more than anybody so far.
The company is working to develop its own cotton alternative propellant, utilizing flax straw and dissolvable wood pulp. Their $200m facility, which at first will focus on Nitrocellulose, will produce upwards of 6000 metric tonnes per year to start, with growth space already being baked into the design, as well as capacity from the onset to work on future propellants such as double-base powders, triple-base powders and rocket propellants.
More impressively, the company says they have already pre-sold its first three years of production through a combination of binding supply agreements and Letters of Intent with allied partners, meaning the company is not reliant on Canadian agreements to be successful, and is already working to establish an export pipeline for its supply.
It's a fairly impressive setup when you get the chance to speak to them. Their facility already has access to pre-existing road, rail, water, and electrical infrastructure. They planned to break ground sometime in Q3 2026, so it should be coming soon if it has not already begun groundbreaking already. The first official production run is targeted for 2028.
The company is also working with Des Nedhe Group to support Indigenous economic reconciliation, with the company working hand-in-hand with DNG not only to support Indigenous employment, but establish training and educational pipelines for Indigenous youth looking to get into the Energetics industry.
They were very proud about that one, and for good reason. I think it's commendable when a company, especially a startup, puts both time and funding into creating educational opportunities in industry, especially when there is an existing lack of training and programs available to support industry. I love to see companies invest in education and workforce development. Same for R&D, which CellCore is already investing in future propellants in collaborations with University Partners.
All-in-All, CellCore has really impressed me in all my talks with them. They are a prime example of charging into a space with notable gaps, getting the work done, and showcasing that Canada's Defence Industry has the capacity not just to support ourselves, but can be independent of government support, and can have export potential out the gate.
They have done just about everything right out the gate, and have a clear roadmap to be a major supplier across the energetics spectrum, with clear growth capacity and plans baked into their initial plans and their future facilities. All of that to say, I am very happy to see more suppliers coming to market for critical materials like propellants, an area where we are desperately lacking not just capacity, but scalable growth to ramp up.
One facility shouldn't have that burden, nor should our domestic supply chain be tied to single facilities. If private industry can fill that gap, such as here, then I am all for it and will always cheer them on to achieve it. When the Federal Government has so much on its plate, we can't always expect them to be the sole supporter in the Supply chain.
Indeed, we put a lot of faith and mandate in Industry to build out our Defence Industrial Base already, but to do that separate of government investment and contracts is always going to be better than waiting on Federal support, especially in an area where we can make a reasonable contribution to both our and allied supply chains.
Between this and the future facility from GD-OTS, Canada will go from no domestic production line for Nitrocellulose to being one of the larger suppliers in NATO, with others like Iron Willow in Alberta as well also looking to stand up their own production lines. That also isn't counting expansion plans circulating around.
If all comes together, it will be a fantastic accomplishment both for Industry and Canada as a whole. It will be a concrete show that we can rise to challenges, find areas where we can plug gaps, and rapidly scale up capacity to become one of NATO's Prime suppliers. If you want a show as to how Canada can build the DIB to be not just export-ready but a premier supplier? This is likely to be one of the major areas that can demonstrate that in the next few years.
So obviously, I hope everyone succeeds lol. I have good faith in everyone to deliver, and with it I have faith that we can rise above and showcase that Canadian Industry is ready to lead.
Noah, do you have contacts at CellCore? Wanted to pass on some info but doesn't look like they have anything other than a general email set up.