Critical Elements Lithium Corp. stands at the forefront of the growing lithium market by capitalising on continued robust lithium demand while navigating the challenges posed by supply constraints.
The global push towards cleaner and sustainable energy sources has resulted in a remarkable surge in demand for lithium, a key component in electric vehicle (EV) batteries and energy storage systems.
This report provides an in-depth analysis of Critical Elements Lithium Corp., highlighting its strengths, strategic advantages, and prospects for growth within the evolving lithium market.
Increasing demand in the lithium market: electric vehicles and energy storage
Critical Elements operates in a market characterised by the escalating demand for lithium, primarily driven by the rapid expansion of the electric vehicle market and energy storage systems.
As nations worldwide adopt cleaner transportation alternatives, the demand for lithium-powered EV batteries is projected to soar. Moreover, the increasing integration of renewable energy sources necessitates efficient energy storage solutions, further fuelling lithium demand.
Critical Elements is well-positioned to capitalise on this lithium market trend, with its lithium projects primed to contribute to the supply chain of these crucial technologies.
Governmental economic support
The Corporation benefits from the favourable economic climate the Québec, Canadian, and US governments have fostered.
These governments recognise lithium’s pivotal role in the transition to sustainable energy and have demonstrated strong support for developing lithium projects and cathode manufacturing.
This support extends to funding and regulatory approvals, providing Critical Elements with a conducive environment for project advancement and growth.
Pikhuutaau Agreement and Indigenous collaboration
Critical Elements has forged a significant partnership with Indigenous communities through the Pikhuutaau Agreement.
This landmark agreement, signed in July 2019, involves the Cree Nation of Eastmain, the Grand Council of the Crees (Eeyou Istchee), and the Cree Nation Government.
It emphasises the Corporation’s commitment to responsible and sustainable development while fostering mutually beneficial relationships with local communities. The collaboration not only promotes socio-economic well-being but also aligns with the principles of ethical mining.
Strategic land package and location advantage
Critical Elements’ strong foundation is emphasised by its expansive land package, covering approximately 1,050 km2. This substantial land area has been strategically acquired. It holds significant promise for hard rock lithium exploration, benefitting from the right geological conditions, scale, and proximity to infrastructure such as roads and abundant, cost-effective renewable energy sources.
Situated in Québec, a globally renowned hub for mining excellence, this land acquisition stands as a testament to the Corporation’s perceptive strategic vision. Recent exploration efforts have further confirmed the inherent potential within this land package.
Noteworthy outcomes include the expansion of the previously studied Lemare Project and the exciting identification of a lithium-rich zone at Duval. The proximity of Duval to the advanced Whabouchi lithium mine scheduled for commissioning in 2025 underscores the importance of this discovery.
The harmonious convergence of favourable geological circumstances, easy access to existing infrastructure, and the availability of affordable renewable energy resources amplify the practicality and economic viability of Critical Elements’ ventures.
This cohesive blend of factors propels the Corporation towards unlocking the true potential of its land package, positioning it as a potent force within the realm of hard rock lithium exploration and the growing lithium market.
Environmental approvals and sustainable practices
Critical Elements Lithium Corp. has adeptly navigated the intricate regulatory landscape within the lithium market, securing vital environmental approvals.
These accomplishments underline the Corporation’s commitment to environmentally responsible practices. The attainment of the Certificate of Authorization under section 164 of Québec’s Environment Quality Act in November 2022 serves as a noteworthy achievement, signifying the Corporation’s dedication to upholding rigorous environmental standards and its resolve to minimise the ecological impact of its operations.
The Corporation’s proactive approach to regulatory compliance and sustainability is further demonstrated through past milestones, including the favourable decision by the Federal Minister of Environment and Climate Change in August 2021 and the subsequent endorsement of the rehabilitation and restoration plan by the Québec Minister of Natural Resources and Forests in May 2022.
As the Corporation moves forward, the imminent receipt of the Project’s Mining Lease emerges as a pivotal milestone, advancing the Corporation’s trajectory towards a final investment decision.
Management expertise and industry experience
One of the cornerstones of Critical Elements’ formidable stature lies in the unmatched expertise of its management team.
At the helm is CEO Jean-Sébastien Lavallée, a seasoned professional renowned for his profound experience in the exploration and advancement of mining enterprises. His leadership, informed by a wealth of industry knowledge, is a guiding force propelling the Corporation’s endeavours within the growing lithium market.
Furthermore, Critical Elements is dedicated to assembling a team of individuals who take ownership of the Corporation’s mission. A pivotal step in this direction involves the recruitment of Yves Perron as the Vice President of Engineering, Construction, and Operation.
Drawing upon his extensive background in project engineering and construction within the mining sector, Perron spearheads forming an adept team. His capability to attract and assemble a diverse talent pool underscores his commitment to driving the successful development and construction of the Rose project.
The depth of management’s acumen is further evidenced by their comprehensive grasp of the lithium industry. Dr Steffen Haber and Dr Marcus Brune, former CEO and CFO of Rockwood Lithium, respectively, bring a reservoir of experience that spans the entire spectrum of the lithium market. Their instrumental roles in shaping, expanding, and orchestrating the sale of Rockwood Lithium in 2015 for a substantial sum stand as a testament to their profound proficiency and strategic prowess.
Their presence augments Critical Elements’ capacity to navigate the industry’s intricacies with sagacity and innovation.
Rose Lithium Project: A foundation for growth in the lithium market
The centrepiece of Critical Elements Lithium Corp.’s portfolio is the Rose Lithium Project, situated in the heart of northern Québec’s administrative region on the traditional lands of the Eastmain Community within the Eeyou Istchee James Bay territory.
The project’s strategic location, comprehensive infrastructure, and geological significance combine to position it as a cornerstone of the Corporation’s success within the lithium market.
Geographical advantage and accessibility
The Rose property boasts a prime location accessible year-round, a feat crucial for mining operations in northern climates. It can be reached by road via the Route du Nord, connecting it to Chibougamau, and is also accessible from Matagami via Route 109 and Route du Nord.
The Nemiscau airport services the region’s air travel needs, with the Rose property site merely 50 km away by road. This accessibility streamlines logistical operations and reduces potential operational disruptions due to weather conditions.
Strategic proximity
The Rose Lithium Project’s geographical proximity to significant industry players highlights the region’s unique potential. It lies 80 km south of Goldcorp’s Éléonore gold mine and 60km to the east of the James Bay Lithium project operated by Allkem.
Additionally, it is 45 km northwest of Nemaska’s Whabouchi lithium project, a geographical alignment that could foster collaborative efforts and shared infrastructure development.
Furthermore, the project is 20 km south of Hydro Québec’s Eastmain 1 hydroelectricity generating plant, offering a reliable and clean energy source for its operations.
Project scope and potential
Covering an area of 24,654 hectares, the Rose property is a testament to Critical Elements’ dedication to exploration and development within the lithium market.
The deposit consists of 26.3m tonnes of probable reserves at grading 0.87% Li2O and 138 ppm Ta2O5 after dilution. The potential for resource expansion remains considerable, as the area remains open in all directions, awaiting further exploration efforts.
The Rose Lithium Project’s envisioned annual production underscores its ambition and potential.
It has projections to produce the following:
- Approximately 157,706 tonnes of chemical-grade 5.6% spodumene concentrate;
- 46,059 tonnes of premium-priced technical-grade 6.2% spodumene concentrate for the glass and ceramics industry; and
- 580 tonnes of tantalum concentrate annually.
The project’s output is poised to impact the lithium and tantalum markets substantially.
Financial viability and sustainability
The Rose Lithium Project stands out not only for its substantial production capacity but also for its financial robustness. Employing conservative price assumptions, the August 2023 Feasibility Study estimated an after-tax NPV of US$2,195m at an 8% discount rate, accompanied by an impressive after-tax IRR of 65.7%.
These metrics, combined with the project’s expected life of 17 years, demonstrate its capacity for generating substantial value over the long term.
The project’s strategy involves adopting an open-pit mining technique, featuring a blueprint with approximate measurements of 1,620 metres in length, 900 metres in width, and 220 metres in depth.
The implementation will rely on established mining practices and equipment. As part of its commitment to enhancing its environmental impact, the Corporation will assess contemporary equipment options, such as electric haulers and trucks, as they become accessible and demonstrate their reliability within the industry.
The dedicated team at Critical Elements is diligently advancing detailed engineering efforts to approach the final investment decision and the commencement of construction. Simultaneously, they are exploring avenues for project financing and engaging in negotiations with various industry participants to formulate an optimal financial arrangement.
This comprehensive package is anticipated to encompass a blend of debt and equity bolstered by the potential inclusion of an offtake agreement. This strategic move aligns with the industry’s urgent requirement to ensure a stable supply for battery production.
These advantages make Critical Elements a significant player in the growing lithium market
Critical Elements Lithium Corp. has emerged as a formidable player in the evolving lithium market, and is poised to harness the relentless demand for lithium in EV batteries and energy storage systems.
The Corporation’s strengths collectively position it for sustained growth and success and they include:
- Governmental support
- Indigenous collaboration;
- A strategic land package;
- Robust projects;
- Environmental approvals; and
- Seasoned management.
As the world pivots towards sustainable energy solutions, Critical Elements’ commitment to responsible mining, innovative practices, and strong industry partnerships further solidifies its role as a cornerstone of the lithium market and a catalyst for positive change in the energy landscape.
