Piedmont Lithium Inc (ASX:PLL, NASDAQ:PLL, XETRA:) and Sayona Mining Ltd (ASX:SYA) have finalized the acquisition of North American Lithium Inc (NAL) thereby consolidating lithium businesses in Québec, Canada.
This acquisition creates a potential lithium production hub in the Abitibi region incorporating the former NAL lithium facilities that are amenable to a rapid restart and Sayona’s Authier and Tansim lithium projects.
Preparations are advancing for the resumption of operations at NAL, with technical studies underway for the profitable production of spodumene (lithium) concentrate from 2023, including a scoping study expected in the second half of 2021.
Sayona’s subsidiary Sayona Québec is 25% owned by Piedmont Lithium and 75% by Sayona while PLL is also Sayona Mining’s largest shareholder with an 18.8% stake.
“Amenable to relatively rapid restart”
Piedmont president and chief executive officer Keith D Phillips said: “We are very pleased to have partnered with Sayona in the consolidation of spodumene resources in the Abitibi region of Québec, with Sayona Québec now comprising a large Canadian lithium resource base.”
“Importantly, North American Lithium is a past-producing business with $400 million of investment over the past decade.
“NAL’s concentrate operations are amenable to a relative rapid restart and we will work with Sayona to develop suitable plans in that regard.”
“We are also evaluating a variety of options for production of lithium hydroxide in Québec and will update the market further as our plans crystallize.
“Piedmont intends to become North America’s leading lithium hydroxide producer and Québec investments are an ideal complement to our flagship Carolina Lithium Project in Gaston County, North Carolina.”
PLL shares are 8.16% higher to A$0.795 while the company’s market cap before the opening was approximately A$424 million.
Potential production hub
This acquisition follows a successful A$45 million placement and A$20 million share purchase plan both of which were heavily oversubscribed.
The partners have commenced studies for the manufacturing of lithium chemicals in Québec, which could position the province to become an important lithium hydroxide production centre given its abundant mineral resources, low-cost, sustainable hydroelectric power, proximity to major US and European electric vehicle markets, and pro-electrification stance of provincial leaders.
In addition, an evaluation of downstream processing at NAL is progressing, as per the NAL acquisition agreement.
Combining NAL with Sayona mining’s Authier Lithium Project creates a potential lithium production hub in the Abitibi region of Québec.
“Turnaround plan”
Sayona’s managing director Brett Lynch said: “We are extremely pleased to have taken control of NAL with our joint venture partner, Piedmont.
“Our local team in Québec is fully engaged in executing our turnaround plan at NAL, including the refurbishment of its facilities and its integration with our flagship Authier Lithium Project.
“We are committed to swiftly developing a profitable and sustainable business at NAL, delivering new jobs and investment and maximising the benefits of its existing facilities to make it the centre of our Abitibi lithium hub.
“Demand for lithium to power North America’s EV and battery storage revolution continues to accelerate. The timing is perfect and we look forward to realising this opportunity, working closely with our partner, Piedmont and all other key stakeholders including Investissement Québec, as we help drive Québec’s clean energy future.”
- Ephrems Joseph