Avalon Announces Partnership Agreement to Establish Ontario's First Regional Lithium Battery Materials Refinery in Thunder Bay
Avalon Announces Partnership Agreement to
Establish Ontario's First Regional Lithium
Battery Materials Refinery in Thunder Bay
Toronto, Ontario--(Newsfile Corp. - April 4, 2022) -
Avalon Advanced Materials Inc.
(TSX: AVL)
(OTCQB: AVLNF) ("Avalon" or the "Company") is pleased to announce that it has signed a binding letter
of intent with RenJoules International Ltd., an
Essar Group Company
("Essar"), to become a strategic
partner and co-developer in support of Avalon's plans to establish a regional lithium battery materials
supply chain to serve the needs of future electric vehicle and battery manufacturers in Ontario and
elsewhere.
This agreement involves providing initial financial and development support for building a lithium refinery
in Thunder Bay, Ontario that will be designed to accept lithium minerals concentrates, not only from
Avalon's Separation Rapids Lithium Project north of Kenora, ON, but also from other aspiring new
producers from the many lithium pegmatite resources that occur in northwestern Ontario. It will operate
as a separate private business, called Avalon Lithium Inc., a newly established Avalon subsidiary in
which Essar will become a co-owner.
With the agreement announced today, the partners will immediately begin the key next steps including;
finalizing initial commercial terms and completion of final feasibility studies for both the refinery
operations and lithium mineral concentrate production at the Separation Rapids site that will provide the
initial feed for the refinery until other new producers also get started. This will also include finalizing the
exact location for the refinery in Thunder Bay and proceeding with initial site preparation work both at
Separation Rapids and the Thunder Bay site.
Present indications on demand for lithium battery materials produced in Ontario are supporting an initial
production capacity for the refinery of 20,000 tonnes per annum of lithium hydroxide and/or lithium
carbonate. This will require a capital investment in the order of C$500 million, which Essar and Avalon
would jointly fund, with funding also anticipated from applicable Government programs and other private
investors including Indigenous businesses in Northern Ontario. With construction planned to begin this
year, it could be in operation by 2025. This will also create new economic development opportunities for
First Nations to take advantage of lithium resources in their traditional territories to produce lithium
mineral concentrates for purchase by Avalon Lithium Inc.
Demand for lithium hydroxide and lithium carbonate continues to grow in North America as new electric
vehicle and battery manufacturing capacity is established both in the U.S. and in Canada. Ontario is now
well positioned to take advantage of the rapid growth with the recent announcement of Ontario's first-
ever Critical Minerals Strategy, which Premier Doug Ford described as "the government's blueprint to
connect industries, resources and workers in our province's north to the future of manufacturing in the
south as we build up home-grown supply chains." Avalon Lithium Inc. will deliver on a key priority of the
government's plan: "growing domestic processing and creating resilient local supply chains" and help
the province become a global leader in the sector. Ontario's rich endowment in critical minerals in the
North uniquely positions Ontario to create the full supply chains and take advantage of the demand for
critical minerals in the emerging new advanced manufacturing sector of the economy.
Speaking on the partnership,
Kush Singh, CEO, Essar Power Limited
said, "We truly believe that green
energy is "the future". This initiative of setting up a lithium refinery is a core part of Essar's global strategy
of investments in the energy transition towards decarbonisation with a prime focus on Green Hydrogen
and Storage. Lithium is a foundational critical mineral for the battery supply chain and with the Ontario
government's stellar vision through its Critical Mineral Strategy, we are confident that this is the right
location and time for our strategic partnership with Avalon and other stakeholders."
Avalon President Don Bubar commented, "While EV manufacturing and lithium battery materials
production can be the initial catalyst for starting critical minerals supply chains in the North, it is just the
beginning where innovation of new products and new efficient processing technologies for other critical
minerals such as tantalum, cesium, and rare earths, can inspire future growth into other areas of
advanced manufacturing including aerospace technology."
The agreement builds on growing Canada-India bilateral economic ties and supports clean energy and
foreign direct investment objectives. The Company wishes to thank the Ontario division of Invest-in-
Canada for introducing Avalon to Essar last year.
About the Essar Group
The Essar Group is a diversified business enterprise based in Mumbai, India that controls a number of
subsidiary companies including Renjoules International Limited involved in the core sectors of Energy
(Exploration & Production, Refining & Marketing, Power, Hydrogen), Infrastructure & Logistics (Ports,
Storage Terminals), Metals & Mining, Technology & Retail (Shipping, Oilfield Services, Projects,
Technology solutions etc.) Essar Global Fund Limited (EGFL), set up in 2005, invests in building and
nurturing Essar Group assets, and creating value in these core sectors.
With Assets Under Management (AUM) of US$8.2 billion, as on 31 March 2021, and a net asset value of
US$4.4 billion, the current investment portfolio of EGFL is future centric and value accretive. EGFL is
now poised to transition its existing assets towards a greener economy and invest in businesses which
will transform sector landscapes from carbon to a clean energy ecosystem. The returns from the
transition will not only outperform benchmark returns but also contribute to a sustainable society within
the framework of Environmental, Social and Governance (ESG) and transform sectors for a post carbon
economy.
About Avalon Advanced Materials Inc.
Avalon Advanced Materials Inc. is a Canadian mineral development company specializing in
sustainably-produced materials for clean technology. The Company now has four advanced stage
projects, providing investors with exposure to lithium, tin and indium, as well as rare earth elements,
tantalum, cesium and zirconium. Avalon is currently focusing on developing its Separation Rapids
Lithium Project near Kenora, Ontario while continuing to advance other projects, including its 100%-
owned Lilypad Cesium-Tantalum-Lithium Project located near Fort Hope, Ontario. Social responsibility
and environmental stewardship are corporate cornerstones.
For questions and feedback, please e-mail the Company at
, or phone Don Bubar,
President & CEO, directly at 416-364-4938 ext. 222.
This news release contains "forward-looking statements" within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation.
Forward-looking statements include, but are not limited to statements that Essar intends to become a
strategic
partner and co-developer in support of Avalon's plans to establish a regional lithium battery
materials supply chain to serve the needs of future electric vehicle and battery manufacturers in
Ontario and elsewhere, that this agreement involves providing initial financial and development
support for building a lithium refinery in Thunder Bay, Ontario that will be designed to accept lithium
minerals concentrates, not only from Avalon's Separation Rapids Lithium Project north of Kenora,
ON, but also from other aspiring new producers, that it will operate as a separate private business in
which Essar will become a co-owner, that the partners will immediately begin the key next steps
including finalizing initial commercial terms and completion of final feasibility studies for both the
refinery operations and lithium mineral concentrate production at the Separation Rapids site, that this
will also include finalizing the exact location for the refinery in Thunder Bay and proceeding with initial
site preparation work both at Separation Rapids and the Thunder Bay site, that present indications on
demand for lithium battery materials produced in Ontario are supporting an initial production capacity
for the refinery of 20,000 tonnes per annum of lithium hydroxide and/or lithium carbonate, that this will
require a capital investment in the order of C$500 million, which Essar and Avalon would jointly fund,
with funding also anticipated from applicable Government programs and other private investors
including Indigenous businesses in Northern Ontario, that construction is planned to begin this year,
that it could be in operation by 2025, that this will also create new economic development
opportunities for First Nations to take advantage of lithium resources in their traditional territories to
produce, that Avalon Lithium Inc. will deliver on a key priority of the government's plan and help the
province become a global leader in the sector. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as "potential", "scheduled", "anticipates",
"continues", "expects" or "does not expect", "is expected", "scheduled", "targeted", "planned", or
"believes", or variations of such words and phrases or state that certain actions, events or results
"may", "could", "would", "might" or "will be" or "will not be" taken, reached or result, "will occur" or "be
achieved". Forward-looking statements are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity, performance or achievements of
Avalon to be materially different from those expressed or implied by such forward-looking statements.
Forward-looking statements are based on assumptions management believes to be reasonable at the
time such statements are made. Although Avalon has attempted to identify important factors that
could cause actual results to differ materially from those contained in forward-looking statements,
there may be other factors that cause results not to be as anticipated, estimated or intended. Factors
that may cause actual results to differ materially from expected results described in forward-looking
statements include, but are not limited to market conditions, and the possibility of cost overruns or
unanticipated costs and expenses as well as those risk factors set out in the Company's current
Annual Information Form, Management's Discussion and Analysis and other disclosure documents
available under the Company's profile at
www.SEDAR.com
. There can be no assurance that such
statements will prove to be accurate, as actual results and future events could differ materially from
those anticipated in such statements. Such forward-looking statements have been provided for the
purpose of assisting investors in understanding the Company's plans and objectives and may not be
appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-
looking statements. Avalon does not undertake to update any forward-looking statements that are
contained herein, except in accordance with applicable securities laws.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/119161