Critical Resources Taps CSIRO to Scale Its Dry Battery Tech

The chemistry works. Peer-reviewed research published in Electrochimica Acta has already confirmed that. What remains unproven, and what matters far more for commercialisation, is whether Critical Resources’ (ASX: CRR) Dry Supersonic Deposition (DSD) process can deliver consistent results when it moves beyond the lab bench and toward manufacturing scale. That is the specific problem CSIRO has now been engaged to solve.

CRR announced on 27 August 2026 that it has secured co-funding under CSIRO’s Kick-Start programme for a 12-month research collaboration commencing September 2026. The total project budget sits at approximately $100,000, with CSIRO contributing up to $50,000 and CRR funding the balance. The work will be led by Dr Saden Zahiri at CSIRO’s Lab22 facility in Clayton, Victoria. CRR’s strategy is not to manufacture battery cells itself but to license DSD as intellectual property, and CSIRO’s role is to generate the independent engineering evidence that makes those licensing conversations credible.

The CSIRO Kick-Start programme eligibility and funding structure requires Australian-registered businesses to contribute matched cash funding, with CSIRO vouchers ranging from $20,000 to $60,000, making CRR’s approximately $50,000 co-contribution consistent with the programme’s standard terms.

Here is what the collaboration specifically covers, why its technical scope matters for CRR’s IP story, and what the realistic next milestone looks like for investors following this programme.

What CSIRO is being paid to do: four workstreams, one digital twin

The project’s starting point is a three-dimensional computational simulation drawn from CRR’s own process parameters, rather than physical experimentation, allowing researchers to probe the DSD spray nozzle and deposition environment in a virtual setting. This digital twin allows researchers to test operating conditions, map sensitivities, and explore failure modes without running costly physical trials. For a company operating at a market capitalisation of approximately $19.16 million, that is a capital-efficient starting point.

Digital twin modelling has become a standard tool for evaluating process variables in advanced materials and manufacturing contexts, allowing engineers to compress months of physical trial-and-error into weeks of computational iteration before committing capital to physical equipment.

The four workstreams build on each other in sequence:

1. Digital twin construction: Simulates the behaviour of gas flows, the paths and speeds of particles, temperature gradients, and the positioning of supersonic shockwaves within the DSD nozzle assembly.
2. Particle velocity and deposition efficiency assessment: Draws on CRR’s particle size distribution data to assess how particles of varying sizes respond at supersonic velocity and how reliably they adhere to the substrate.
3. Defect analysis and process window mapping: Employs the digital twin to pinpoint process conditions linked to cracking or weak inter-particle adhesion, establishing the range of operating parameters within which DSD reliably produces high-quality layers.
4. Optimisation and scale-up recommendations report: Produces a comprehensive formal report setting out recommended process refinements, approaches to experimental validation, and routes toward production at commercial scale.

The logic is sequential. You cannot map defects until you understand particle behaviour, and you cannot model particle behaviour until you have built the nozzle simulation. Each workstream produces data the next one consumes.

Dr Saden Zahiri leads the work at CSIRO’s Lab22, a facility specialising in advanced additive and robotic manufacturing. That institutional standing matters: the output will carry CSIRO’s name, not a generalist consultancy’s. For cell manufacturers evaluating a licensing deal, that distinction is the difference between informal advice and defensible, independent process documentation.

The technology under the microscope: what DSD does and what has already been proven

DSD is a solvent-free, binder-free battery cathode manufacturing technique. It works by accelerating dry powder particles to supersonic velocities in an inert gas stream, mechanically consolidating them directly onto a conductive substrate. That single sentence eliminates several conventional manufacturing stages in one go.

Solvent-free cathode manufacturing has attracted growing industry attention in 2026 as cell producers weigh the capital and environmental costs of conventional slurry-based processes against emerging dry deposition alternatives at various stages of commercial readiness.

What DSD removes from the cathode production process:

• Slurry mixing
• Drying ovens
• Solvent recovery systems
• Furnace processing
• Pressing

Each of those steps adds capital cost, energy consumption, and environmental complexity to conventional cathode manufacturing. DSD bypasses them entirely.

The chemistry has been independently validated. Findings published in Electrochimica Acta and subject to peer review established that DSD is capable of producing lithium iron phosphate (LFP) cathodes that are both structurally sound and electrochemically functional, without relying on solvents or polymer binders. Laboratory testing at the South Dakota School of Mines and Technology’s NSF-supported Centre for Solid-State Electric Power Storage corroborated those results. The partnership with the South Dakota team remains ongoing.

The more significant milestone sits beyond standalone cathodes. CRR has demonstrated a single room-temperature pass that co-deposited three distinct materials onto battery-grade aluminium foil: an LFP cathode, an LLZO solid electrolyte (the layer that conducts lithium ions between cathode and anode), and a carbon-nanotube conductive network. The result was a uniform composite layer approximately 15 microns thick.

Solid-state milestone: A single room-temperature DSD pass co-deposited an LFP cathode, LLZO solid electrolyte, and carbon-nanotube conductive network onto battery-grade aluminium foil, producing a uniform composite layer of approximately 15 microns, eliminating slurry preparation, drying, furnace processing, and pressing in one manufacturing step.

That milestone is what makes CSIRO’s scale-up modelling commercially consequential. If the process window can be defined and defects controlled, one manufacturing step could replace several in conventional solid-state cell fabrication. The science is not the primary risk anymore. The process is.

The licensing thesis and what this CSIRO collaboration changes for investors

Tim Wither, Managing Director of Critical Resources, has framed the company’s thesis in direct terms: the constraint holding back solid-state battery commercialisation is not chemistry but the ability to manufacture cost-effectively, consistently, and at scale.

Tim Wither, Managing Director, Critical Resources: Solid-state battery development is not held back by a lack of promising chemistry. The real shortfall is the capacity to manufacture that chemistry affordably, reliably, and at volume. DSD is aimed squarely at closing that gap.

CRR is not building a factory. It holds provisional patents, has peer-reviewed third-party validation, and is now building engineering data through CSIRO’s digital twin modelling. The licensing model means CRR’s value creation depends on the quality and credibility of its intellectual property, not on capital-intensive cell production.

The solid-state battery manufacturing hurdles that CRR’s DSD process is designed to address sit at the centre of a broader industry challenge: almost every competing approach to solid electrolyte integration still depends on high-temperature processing steps or solvent-intensive slurry systems that add cost and complexity.

The CSIRO collaboration fills a specific gap in that narrative. Before this project, CRR had lab-validated chemistry and a peer-reviewed publication. What it lacked was independent, institution-backed engineering data on whether the DSD process can be made reproducible at scale. That is precisely what CSIRO has been engaged to produce. The IP evidence stack now reads:

• Peer-reviewed publication in Electrochimica Acta
• NSF-supported laboratory validation at South Dakota School of Mines and Technology
• Provisional patents filed
• Solid-state single-pass milestone achieved
• CSIRO digital twin modelling now underway

CRR’s share price was unchanged at 0.6 cents on announcement day, implying a market capitalisation of approximately $19.16 million. The ASX 200 closed at 9,032.1, up 95.7 points, providing a supportive broader market backdrop. The market did not move on the announcement, which is consistent with how micro-cap IP stories are priced: the market is waiting for the output, not the commencement.

The forward-looking risk variables are real. No interim CSIRO milestones have been publicly disclosed beyond the overall 12-month framework. Provisional patents provide a filing date but not granted rights; converting them is a separate risk variable that CSIRO’s work does not resolve. No named licensing or joint-development counterparty has been publicly confirmed as of 27 August 2026.

For investors, the key watch-points over the next year are:

• CSIRO interim findings from digital twin modelling workstreams
• CSIRO’s final scale-up recommendations report (expected no earlier than September 2027)
• Progression from provisional to granted patents
• Any public disclosure of licensing or joint-development discussions with a named counterparty

What the CSIRO report delivers, and what remains unresolved

The 27 August 2026 announcement is a commencement signal, not a validation event. The commercially significant deliverable is CSIRO’s final report with formal scale-up recommendations, and that is at least 12 months away.

CRR’s IP narrative becomes materially stronger under three specific conditions: CSIRO defines a reproducible process window, provisional patents progress to granted status, and a named licensing counterparty emerges. None of those conditions has been met yet.

For investors who have been following the lithium and graphite price cycle, CRR’s DSD programme represents a structurally different bet. It is not exposed to commodity price swings. It is exposed to whether a manufacturing process can be made consistent and licensed, a technology risk rather than a market risk. At $19.16 million market cap, CRR is priced for early-stage process risk. The CSIRO collaboration is the mechanism through which that risk is either reduced or confirmed over the next 12 months. The final recommendations report is the catalyst to watch, not this announcement.

ASX battery materials positioning in 2026 spans a wide range of risk profiles, from producing lithium miners with direct commodity price exposure to early-stage technology companies like CRR whose returns depend on IP commercialisation rather than resource extraction.

This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with financial professionals before making investment decisions. Forward-looking statements regarding CRR’s commercialisation plans, CSIRO project outcomes, and licensing prospects are speculative and subject to change based on research results, market developments, and company performance.