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Securing the Canadian Battery Supply Chain Challenge


Challenge Synopsis

Nemaska Lithium inc. is building in Quebec a mine and an electrochemical plant to produce lithium salts for the growing electric vehicle (EV) battery market. The objective of Nemaska Lithium with this challenge is to enable a real cleaner transition towards electrification of transportation, and thus the Company is actively working to implement and secure in Canada, in collaboration with provincial and federal governments, a full supply chain for lithium-ion batteries from the mine to the battery cell, including recycling of used batteries.

 

Challenge Statement

Nemaska Lithium is seeking financial partners to complete the financing required to attain two main goals. First, it needs to complete construction and start of operations at both its mine located in Northern Quebec and its electrochemical plant in Shawinigan, QC. Second, in partnership with Canadian and international partners, it is working on developing an innovative project that will enable the recycling of used lithium-ion batteries to recover directly cathodes active materials.

 

Context

In May 2018, Nemaska Lithium announced that it has completed a CAD 1.1B (USD 849M) financing package (the “Project Financing Package”) with the closing of i) a CAD 280M public offering of common shares on a bought deal basis; ii) a CAD 80M concurrent private placement of common shares with Ressources Québec Inc., acting as mandatory for the government of Québec; iii) a USD 350M offering of senior secured callable bonds; and iv) the release from escrow of CAD 93.8M (USD 72.1M) from the previously closed private placement with SoftBank Group Corp. In February 2019, following an assessment conducted in order to reflect the current level of detailed engineering and reception of numerous firm quotes for equipment and installation, it was determined that additional net funds of approximately $375 million are required to complete the construction and start of operations at both the Whabouchi Mine and Shawinigan Electrochemical Plant. Nemaska Lithium is therefore actively looking for investors and partners to secure these additional funds.

 

Response Criteria

  • Having an interest in investing in the EV battery market supply chain in Canada;
  • Financing options include M&A, equity financing and/or debt.

 

The Opportunity

The innovative process developed and patented by Nemaska Lithium inc. enables ca. 75% lower use of chemicals, by using hydroelectricity instead, and 98% reduction of GHG emissions when compare to the conventional process, making it the cleanest process worldwide to produce high-purity lithium salts for the battery market. The project was also developed in partnership with local First Nations, signing in 2014 an Impact and Benefit Agreement and making them one of the main shareholders of the Company. The Corporation has also demonstrated its capacity to produce high-purity materials with its green process by producing hundreds of tons at its Phase 1 Plant since February 2017, all of which were sent to potential and existing clients whom confirmed the outstanding quality of the product and the full compliance with applicable quality specifications. Nemaska Lithium is thus positioned to be at the forefront of implementing in Canada a green supply chain for the EV battery market, positioning the country as the most environmentally and socially responsible producer of batteries worldwide. In a market driven by end-user demand for a greener economy based on the electrification of transportation, among others, securing in Canada a real green supply chain for EVs generates unique opportunities for those interested in investing early in its implementation.

 

About Nemaska Lithium Inc.

Nemaska Lithium is a developing chemical company whose activities will be vertically integrated, from spodumene mining to the commercialization of high-purity lithium hydroxide. These lithium salts are mainly destined for the fast-growing lithium-ion battery market, which is driven by the increasing demand for electric vehicles and energy storage worldwide. The Corporation will be operating the Whabouchi mine located in the Eeyou Istchee / James Bay Region of Quebec, Canada, near the Cree community of Nemaska, one of the richest lithium spodumene deposits in the world, both in volume and grade. The Nemaska Whabouchi spodumene deposit has an initial lithium mine life of 33 years. The spodumene concentrate produced at the Whabouchi mine will be processed at the Shawinigan electrochemical plant using a unique membrane electrolysis process for which the Corporation holds several patents.