Nemaska, Hanwa sign lithium deal

By Martim Facada
Published: Thursday, 28 June 2018

Nemaska will begin to ship lithium spodumene concentrate in Q3 next year, after completing the ramp-up of its Whabouchi mine in Quebec.

Canada-based Nemaska Lithium has reached an agreement to supply spodumene Li2O concentrate to Japan-based Hanwa, which will be acting as agent for China’s General Lithium.

Nemaska’s spodumene Li2O concentrate will be sold on a take-or-pay basis to a market price-based formula at the time of delivery. This will take into account the current market price of $800-1,000 per tonne, the company told Industrial Minerals at the end of May.

Industrial Minerals assessed the price of spodumene, min 5-6% Li2O, cif China, was $900-970 per tonne on April 25, and $855-925 per tonne on an fob Australia basis.

Nemaska plans to ship lithium spodumene concentrate, typically min 5-6%, beginning in the third quarter of 2019, it told Industrial Minerals. To achieve this, in the third quarter of this year it will start to ramp up the operations of its mine in Whabouchi, in the James Bay area of the Canadian province of Quebec.

Selling Whabouchi’s spodumene will enable Nemaska to generate revenue while the company is working to bring online its electrochemical plant in Shawinigan, also in Quebec. It intends to complete this by June 2020.

During the interim period, to generate revenue from the sale of its spodumene concentrate, Nemaska has said that it could export almost 213,000 tonnes per year once the mine is fully ramped up.

"Our business plan remains to be vertically integrated and to sell lithium hydroxide and lithium carbonate from our electrochemical plant in Shawinigan," president and chief executive officer Guy Bourassa said. 

"However, given that the Whabouchi mine will be in production about a year before the electrochemical plant is ready to be commissioned, we decided to be opportunistic and to sell spodumene concentrate in the interim, effectively enabling us to generate revenue by the last quarter of 2019," he added.