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Lithium Universe Limited (referred to as "Lithium Universe" or the "Company," ASX: "LU7") provides a strategic update on addressing the gap in lithium conversion capacity and enhancing the North American supply chain.
Highlights
- Lithium Universe to play pivotal role in closing the lithium conversion gap
- Lithium Universe to convert supply in North America.
- Target conversion contracts with OEMs who have spodumene off take
- Target "take or pay" agreements with OEMs to reduce market/price risks
- Geopolitical shift to onshore the battery supply chain in North America
- Canada emerges as next key global lithium supply chain
- LFP batteries expected to capture 87% of the ESS market share by 2033
- Strong Federal and Provincial government financing support within the industry
- Lithium Universe committed to building through the lithium cycle
What is the ‘Lithium Gap’?
North America anticipates a surge in battery manufacturing, with over 20 major manufacturers planning to deploy an estimated 1,000GW of battery capacity. Canada has ascended to the top spot in BloombergNEF's Global Lithium-Ion Battery Supply Chain Ranking, signalling its emergence as a significant global supplier of battery materials. However, bridging the gap between the growing supply of lithium ore and the increasing demand for highly processed lithium carbonate remains a challenge and opportunity.
Lithium Universe is advancing a mine-to-battery-grade lithium carbonate strategy in Canada through the Québec Lithium Processing Hub (QLPH). The QLPH includes a multi-purpose independent 1 Mtpa concentrator and an independent 16,000 tpa battery-grade lithium carbonate refinery.
Over the past decade, numerous lithium conversion plants worldwide have encountered technical and startup challenges. Even established lithium producers have found lithium conversion to be a challenging task. Lithium Universe presents a solution to mitigate these risks. The company has formed a team, dubbed the Lithium Dream Team, comprising experts in hard rock lithium extraction and downstream conversion operations. Additionally, strategic partnerships with engineering consultants Hatch Ltd and Primero Group have been forged. By leveraging proven technology in spodumene concentration and lithium conversion design, the company aims to minimize execution risk. Notably, the Dream Team previously spearheaded the successful construction of the Jiangsu Lithium Carbonate facility, surpassing design expectations to produce the world's premier battery-grade carbonate. This project was built by Hatch Ltd. Lithium Universe intends to replicate the design and operational methodologies implemented at Jiangsu, viewing this, coupled with the expertise of the Dream Team, as pivotal in establishing conversion capacity in North America.
Figure 1: ‘The Lithium Gap’ emerging between North America’s planned conversion facilities estimated to have 100,000t LCE per annum capacityandthedownstreamdemandestimatedtototalanestimated850,000tLCEperannum.
The Emerging James Bay Supply
The Company has engaged with numerous exploration entities operating within the region of James Bay, Québec and estimate there are over 40 companies dedicated to lithium exploration in the area. Our assessments indicate a cumulative lithium resource exceeding 500Mt at +1% Li2O across eight distinct projects, which has increased over 100% within the last 12 months. This significant increase is due to the upgraded resource of 110.2Mt at 1.3% Li2O by Arcadium Lithium at the James Bay Project, the maiden resource of Patriot Battery Metals at Corvette of 109Mt at 1.42% Li2O and most recently the announcement of Winsome Resource’s 59Mt at 1.12% Li2O resource at their Adina Project.
This article includes content from Lithium Universe Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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