BÉCANCOUR, QUE. -- The governments of Quebec and Canada have announced $300 million in funding for a factory that will make components for electric vehicle batteries in Bécancour, Que., located about halfway between Montreal and Quebec City.

The $600-million factory, a joint project between automaker General Motors and South Korean industrial materials maker POSCO Future M, was first announced by the companies last year.

The factory will manufacture cathode-active materials, a key component of lithium-ion batteries found in electric cars, and is expected to employ around 200 people when it opens in 2025.

Quebec Premier François Legault said the factory, which is already under construction, sends a signal that Quebec is open to investment from international companies as he attempts to make the province a leader in green energy.

"We have an exceptional opportunity," he told reporters in Bécancour. "We have Hydro-Québec, so we have clean energy. We have strategic minerals, like lithium."

Legault said his government is lending the companies $152 million, of which $132 million will be forgiven if the factory maintains the promised jobs for 10 years.

"It's win-win for Quebec," he said, adding the jobs will lead to higher tax revenue for the province.

The project is part of a larger green energy corridor that includes Bécancour and the nearby cities of Trois-Rivières and Shawinigan, which are home to a number of companies and research institutions doing work related to electric vehicles, Legault said.

Federal Industry Minister François-Philippe Champagne told reporters Ottawa will provide a "contribution" of up to $147 million, but he did not specify the nature of the funding.

South Korean Ambassador Lim Woongsoon told the news conference the investment in the factory is a sign of the strengthening friendship between Canada and his country.

The announcement comes a little more than a week after automaker Ford announced it would buy thousands of tonnes of lithium hydroxide — a component in electric car batteries — produced by Quebec company Nemaska Lithium at its Bécancour plant.

This report by The Canadian Press was first published May 29, 2023.