Three Chinese companies have been told to sell their lithium mining assets in Canada after the Canadian government restricted foreign participation in supplying critical minerals amid rising demand. The order coincides with escalating tensions between the West and China over the control of minerals like lithium, rare earths and other materials used in electric vehicles (EVs), solar panels, wind turbines, mobile phones, and other emerging technologies. According to Industry Minister Francois-Philippe Champagne, the government has asked Sinomine Rare Metals Resources, Chengze Lithium International Ltd. and Zangge Mining Investment Co. to divest from Canada’s Power Metals Corp., Lithium Chile Inc. and Ultra Lithium. Champagne said that Canada welcomes foreign investment but “will act decisively when investments threaten our national security and our critical minerals supply chains.” Meanwhile, FE Battery Metals (CSE:FE) (OTCQB:FEMFD), Albemarle (NYSE:ALB), Sigma Lithium (NASDAQ:SGML), Sayona Mining Limited (OTC:SYAXF), and Standard Lithium (NYSE:SLI) are progressing on lithium projects in North America.
FE Battery Metals (CSE:FE) (OTCQB:FEMFD) is a Canadian mineral exploration company primarily interested in acquiring a portfolio of multicommodity mineral properties. Its mission is to identify, acquire, and explore mineral prospects in the technology metals, precious metals, and base metal sectors in North America. The Company owns a 100% interest in the Augustus Lithium Property in the towns of Landrienne and Lacorne, Quebec, Canada.
On November 8, FE Battery Metals announced the results of drill hole LC22-39 from the Phase 2 drill program at its Quebec-based Augustus Lithium property. The drill hole LC21-39 intersected three lithium pegmatites at a depth of 188.7 metres, with the main 7.3 m wide pegmatite zone averaging 1.54% lithium oxide (Li2O).
The Phase 2 drill program is based on historical and 2021 Phase 1 exploration data, as well as surface trenching and sampling results from FE Battery Metals. Several historical drill hole collars were also discovered on the property, which aided in the location and orientation of drill holes for the current program. The drill program is overseen by Forage Hebert Inc. Drilling of Amos, Quebec. A B-20 drill rig that can drill holes up to 1,000 metres deep is being used for this work. A core shack for drill core logging, sample preparation, and storage is being built in the village of St-Dominique du Rosaire, about 50 kilometres from the property. On the property, 42 drill holes totaling over 7,500 metres of core drilling have been completed.
FE Battery Metals released the findings from drill holes LC21-33 to 37 at Augustus in October. Drill hole LC21-35 intersecting an 11.20-meter-wide zone with 0.91% lithium oxide (Li2O) at 146 metres and a 5 metre zone with 1.03% Li2O at 146 metres a 3.2 metre zone with 1% Li2O at 154 metres, was one of the results’ highlights. In addition, this drill hole contains several smaller intercepts with varying lithium grades and a lower zone measuring seven metres wide and having 0.54% Li2O at 165 metres of drilled depth.
Mining Companies Are Progressing on Lithium Projects
Albemarle (NYSE:ALB) reported net sales of $2.1 billion in the third quarter of 2022, an increase of $1.3 billion over the prior-year quarter, primarily due to increased pricing driven by solid demand from diverse end markets. Albemarle‘s net income of $897.2 million increased by $1.3 billion over the prior-year quarter. To improve focus and execution on its multiple growth opportunities, the company is realigning its core portfolio into Energy Storage and Specialties. The evolution of lithium-ion batteries and the transition to clean energy will be the focus of Energy Storage. Albemarle Specialties merges the existing Bromine and Lithium specialties businesses. Lithium net sales increased by $1.1 billion due to higher pricing net of FX from renegotiated contracts and increased market pricing.
In September, Sigma Lithium (NASDAQ:SGML) appointed Dana Perlman as its third independent director. Ms. Perlman is a highly accomplished businesswoman with significant expertise in strategy, finance, investment banking, corporate governance, financial reporting, internal controls, and compliance. This appointment aligns with the Company’s goals to follow best practices in governance, diversity, equity, and inclusion. With this appointment, the board of directors of Sigma Lithium now includes 50% independent directors, 33% women, and 50% members of underrepresented groups. During the second quarter, Sigma Lithium significantly expanded the scope of the Grota do Cirilo Project, increasing its planned near-term production of Battery Grade Sustainable Lithium to 531,000 tonnes per year. Project construction progress is 32% overall, compared to a baseline of 40%.
Sayona Mining Limited (OTC:SYAXF) has made significant progress toward restarting production at the North American Lithium (NAL) operation in Québec, increasing construction, procurement, recruitment, and other activities amid rising lithium demand. The restart of NAL is scheduled for Q1 2023 as permitting applications and procurement are both 96% complete as of the end of September. Construction work is also ongoing, with the installation of the HP300 and HP400 Cone Crushers nearing completion and the Wet High Intensity Magnetic Separator (WHIMS) fully assembled, among other things. Commitments to the end of September totaled C$43.6 million, compared to C$45.9 million planned.
On October 27, Standard Lithium (NYSE:SLI) announced an update on the commercial development activities taking place in El Dorado, Arkansas. The company said that its first direct chloride-to-hydroxide Pilot Plant has been installed. A third-party global water and process technology vendor designed and built the Hydroxide Pilot plant earlier in 2022. It was successfully installed and commissioned at the Project site in early October. The technology is housed in a self-contained unit. It uses a novel ion-exchange process to convert the lithium chloride feed produced by the Company’s existing Direct Lithium Extraction (DLE) Demonstration Plant directly into a lithium hydroxide solution. This Hydroxide Pilot will be run at the Project site for several months and will be used by Standard Lithium to evaluate various technology options for producing lithium hydroxide at the Company’s South West Arkansas Lithium Project.
FE Battery Metals recently announced a corporate restructuring to spin off assets connected to its current exploration properties in Ontario and Quebec into a wholly-owned subsidiary. For each share of FE Battery Metals held post-consolidation, shareholders will receive one common share of Spinco.
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