QUÉBEC MINES 2016
ADVANTAGES OF THE NEMASKA’S
ELECTROMEMBRANE PROCESS FOR THE
DIRECT PRODUCTION OF HIGH PURITY
LITHIUM HYDROXIDE
Jean-Francois Magnan – Technical Manager
TSX - NMX and OTCQX – NMKEF
November 23, 2016
Forward-looking Statements
During the course of this presentation, Nemaska Lithium
Inc. will make a number of statements with regard to the
Company’s projects, business strategy and plan, which
could be construed as forward-looking.
Such forward-looking statements are subject to risks and
uncertainties that could cause results to be materially
different than expectations. It is uncertain if further work
will in fact lead to production of a mineral resource and of
lithium compounds.
Nemaska has filed on SEDAR a NI-43-101 compliant revised
updated feasibility study published dated June 8, 2016. All
technical information should be reviewed according to this
feasibility study.
2
Megafactories Pushing on Demand for Lithium
• These factories will require an additional 100,000t to 120,000t of LCE by
2021, this supply currently does not exist.
3
Lithium Hydroxide Prices Upward Trend Expected
Current term selling
price for LiOH-H2O
Nemaska Lithium 2016 Updated
Feasibility Study selling price for LiOH-H2O
4
Lithium Carbonate Prices Upward
Current term selling
price for Li2CO3
Nemaska Lithium 2016 Updated
Feasibility Study selling price for Li2CO3
5
Quebec, Very Good Location and Jurisdiction
Positioned to Become a
Fully-Integrated Lithium Producer
•
Mine and concentrator located in
Eeyou Istchee James Bay region,
300km North of Chibougamau
• 1.1MT/y ore
• 213kt/y 6% Li2O concentrate
• 171 employees
•
Transport by road and rail (CN)
Chibougamau
• 18 rail cars/3days
•
Hydromet Plant in Shawinigan
(855km away from mine)
• 27.6kt/y LiOH-H2O
• 3.26 kt/y Li2CO3
• 86 employees
Shawinigan
6
Excellent Infrastructure at Mine Site
7
Grade is KING + Low levels of Impurities
Category
Proven
Probable
Proven and probable
Proven
Probable
Proven and probable
Reserves
Tonnage (Mt)*
Li2O (%)
Open pit
11.7
1.58
8.3
1.46
20.0
1.53
Underground
1.6
1.27
5.7
1.29
7.3
1.28
8
Resources
Category
Measured
Indicated
M+I
Inferred
Tonnage (Mt)*
12.998
14.993
27.991
4.686
Li2O (%)
1.60
1.54
1.57
1.51
Hydromet Plants Existing Buildings in Shawinigan, Quebec
Commercial Plant
Phase 1 Plant
Artist rendition to modify existing site and buildings
9
The two key advantages of Nemaska Lithium
• Mining advantages : Nemaska Lithium has a World Class Lithium
Asset: Whabouchi Spodumene Mine
– 2nd richest and largest deposit in the world - 27.3 MT Proven and Probable
Reserves for an initial 26 years mine life - potential to increase
– Homogenous ore with average grade 1.53% Li2O. Very low stripping ratio 2:1
and very wide dykes allows low dilution (<10%). Low micas ore, low sodium
and potassium concentrate.
– 6.0% Li2O grade concentrate mainly produced by gravimetric technique, i.e.
dense media separation (DMS)
• Transformation advantages : Proprietary electromembrane
process to directly produce preferred high-purity lithium
compound for batteries – lithium hydroxide monohydrate
– Cleanest Lithium Production Process
10
Mining advantages
• High average grade : 1.53% Li2O (coarse spodumene crystals)
• Very low stripping ratio (very narrow open pit design)
• Low dilution (wide spodumene pegmatite dykes)
The geological characteristics and the process allows the production of
high grade spodumene concentrate with high recovery and low cost by
using mainly gravimetric concentration technique (DMS)
11
Nemaska electrochemical process advantages
•
Nemaska Lithium has developed an electromembrane process
to directly produce lithium hydroxide using low cost hydroelectric power.
•
This electromembrane process convert lithium sulfate extracted
from spodumene concentrate into lithium hydroxide and
sulfuric acid. In comparison with the conventional process
which produces lithium carbonate using soda ash and produces
salt cake as by-product.
•
The Nemaska process has significant advantages. The quality of
the product is higher, the operational cost is lower and the
benefits for the environment are huge.
12
Conventional versus Nemaska electrolytic process
•
Both processes extract lithium from hard-rock spodumene using H2SO4 to
produce the intermediate compound Li2SO4(aq)
•
Conventional process (1954) is a chemical process: Use of Na2CO3 to
precipitate Li2CO3 from Li2SO4 aqueous solution;
Na2CO3(aq) + Li2SO4(aq) = Li2CO3 + Na2SO4(aq)
•
Nemaska process is an electrochemical process: Use of hydroelectric
power to split Li2SO4 into LiOH and H2SO4 with reaction at the electrodes;
Cathodic reactions;
Anodic reactions;
2H2O + 2e → H2 + 2OH-
2H2O → O2 + 4H+ + 4e
Li+ + OH- → LiOH(aq)
2H+ + SO42- → H2SO4(aq)
13
Conventional process for Li2CO3 using Na2CO3
14
Membrane electrolysis process principle
-
+
Li2SO4(aq)
C
A
Cathodic Process:
2H2O+ 2e gH2 + 2OH
-
Anodic Process:
-
2H
4e g
O2 +++2e
4H+
2H2O
2O+ →0
2 +4H
H2 O
Li+
H2 O
Li+ + OH g LiOH(aq)
2H+ + SO42- g H2SO4
H2
OH
SO42-
O2
-
H
LiOH
H2O (Li2SO4)
15
H2SO4
+
The advantages of the Nemaska LiOH electrosynthesis
The Nemaska Lithium proprietary process;
•
directly produce high purity lithium hydroxide solution (LiOH), not
technical grade Li2CO3 that needs to be repolished.
•
does not use soda ash (Na2CO3) or caustic soda (NaOH)
•
does not generate any salt cake by-product (Na2SO4∙10H2O)
•
produces high purity lithium carbonate by bubbling carbon dioxide
(CO2) into the electrochemically generated lithium hydroxide (LiOH)
solution.
•
drastically reduces the chemicals consumption. Can reuse the
electrochemically generated sulfuric acid.
•
drastically reduces the green house gases (GHG) related to the
production of lithium raw material for the battery industry !
16
Nemaska Added Value : Produce Directly LiOH•H2O
Concentrate
C$2,693/t
*US$ 2,154/t
Calcination
Roast with
sulphuric
acid
Lithium
Sulfate
Solution
•
Remove
Fe, Al, Si,
Cu
Remove
Ca, Mg
Remove
impurities
to ppb
levels
Primary
Impurity
Removal
Secondary
Impurity
Removal
Ion
Exchange
Lithium
Hydroxide
Monohydrate
Membrane
Electrolysis
Proprietary process to produce directly LiOH•H2O :
– without using soda ash (Na2CO3) or caustic soda (NaOH)
– without producing any salt cake by-product (Na2SO4)
– producing lithium carbonate using CO2
– CDN Patent Notice of Allowance Received
* Exchange rate as per Feasibility Study $1.00 CAD = $0.80 US
17
Lithium
Hydroxide
Solution
C$3,441/t
*US$ 2,753/t
Lithium
Carbonate
2016 Feasibility Study Highlights
Expected Mine Life and pay back period
26 years with 2.4 year pay back period
Life of Mine Revenue
$9.2 Billion (US$7.4 B) (average of $354M/yr for 26 yrs)
Pre-Tax
After tax
Undiscounted Cash Flow
$6.2 Billion (US$4.9 B)
$3.9 Billion (US$3.1 B)
(average of $260M/yr before initial CAPEX)
NPV
$1.9 B (US$1.5B) 8% Discount
$1.2 B (US$928M) 8% Discount
Internal Rate of Return (IRR)
37.7%
30.3%
Total Initial
Capital Costs
Average Cost Per Tonne Spodumene
Concentrate
Average Cost Tonne Lithium
Hydroxide
Average Cost Tonne Lithium Carbonate
99.99%
Yearly average production
C$549M (US$439M) in CAPEX including contingency
C$181/t (US$145/t) FOB Mine C$231/t
(US$185/t) CIF Shawinigan
C$2,693/t (US$2,154/t) FOB Shawinigan lowest cost producer
C$3,441/t ($US2,753/t) FOB Shawinigan lowest cost producer
≈213,000 tonnes of concentrate (6%) Mine site
≈27,500 tonnes of lithium hydroxide Hydromet plant in Shawinigan
≈3,245 tonnes of lithium carbonate Hydromet plant in Shawinigan
Exchange Rate $C to $US
1 : 0.8
Sales Prices FOB Shawinigan Lithium Hydroxide US$9,500/t, Lithium Carbonate US$7,000/t
(All calculations assume a 6% Li2O spodumene concentrate) (All figures are quoted in $CDN, unless otherwise specified)
18
Nemaska Lithium – LiOH.H2O Lowest Cost Producer
NMX cash Cost
Lithium
Hydroxide
19
What’s Next in 2016
On top of commissioning the Phase 1 Plant and
working on project financing.
• Install and commission modular DMS concentrator
• Start a bulk sample to:
– feed Phase 1 plant
– Optimization work on concentrator and calcination
– Train local workforce
• New resources and reserves update following
completion of 17,000m drilling program
• Build shell of concentrator building
20
Modular DMS concentrator at Whabouchi site
21
Progress at the Mine Site
22
Progress at the Phase 1 Plant Site
23
Conclusion – Nemaska Lithium is THE Li Project
•
Given the forthcoming shortage in lithium hydroxide supply, Nemaska
Lithium is perfectly timed to enter the chain of supply
•
Phase 1 production plant is a sound decision, significantly reduces
funds required and de-risk start up of commercial production
•
Permitted 2nd richest and largest lithium hard rock mine in the world
with at least 26 years reserves
•
State of the art processes of producing lithium hydroxide and lithium
carbonate - leading advantage over peers
•
Commenced project financing and construction
•
Supportive Quebec Government
Appendix
RB Energy Comparison
Main Differences Between Whabouchi Mine and Quebec
Lithium Project (according to respective FS)
Ore Grade 55% higher at Whabouchi :
Whabouchi 1.46% Li2O
QLI 0.94% Li2O
Stripping ratio 2.5 time lower at Whabouchi:
Whabouchi 2.2/1
QLI 5.5/1
Dilution far greater at QLI: QLI has over 50 narrow veins compared to one
main thick dyke at Whabouchi making it a lot easier to control grade and
dilution to feed the concentrator
Ore mined versus LCE output: NMX to make 40% more LCE final products by
mining 30% less ore.
Concentrate grade: The required grade of the spodumene concentrate to
produce lithium carbonate and hydroxide is 6% Li2O. Whabouchi ore steadily
reached that grade. QLI was targeting 5% Li2O.
26
Nemaska Lithium and RB Energy (CLQ) Same Scale Comparison
Sources:
Sources:
Technology Management Group, 2012, Feasibility
Study Updated, NI 43-101 Technical Report
Quebec Lithium Project, La Corne Township
Quebec, October
Canada Lithium Corp. Website:
www.canadalithium.com
Met-Chem Canada, 2014
Feasibility Study on the Whabouchi Lithium Deposit
and Hydromet Plant NI 43-101, June 2014
Nemaska Lithium Website:
www.nemaskalithium.com
Whabouchi Deposit: Surface resources classification in plan view
Whabouchi Deposit Informations
Loca ti on
Ja mes Ba y, Quebec, Ca na da
100% owned
YES
Li fe of mi ne
26 yea rs
Stripping Ratio
2.2 : 1
Li -Hydroxi de producer
YES
Li -Ca rbona te producer
YES
Whabouchi Mineral Reserves
Category
Tonnes
Li2O Grade
Proven
13,300,000
1.54%
Proba bl e
14,000,000
1.39%
Total
27,300,000
1.46%
Cut-off Gra de
0.43%
Whabouchi Deposit informations
Informations
Location Quebec Lithium Deposit
Abitibi,
Quebec, canada
Loca
ti on
Abi ti bi , Quebec,
Ca na da
100%
owned
YES
Life of
mine
14.9YES
years
100%
owned
Ratio
5.5 yea
: 1 rs
LiStripping
fe of mi ne
14.9
Li-Hydroxide
YES: 1
Stripping
Ratioproducer
5.5
Li -Hydroxi de producer
Li -Ca rbona te producer
NO
YES
Whabouchi Mineral Reserves
Quebec Lithium
Category
Tonnes Mineral Reserves
Li2O Grade
ProvenCategory
6,605,000Tonnes
0.92%
Li2O Grade
Probable
10,459,000
0.95%
Proven
6,605,000
0.92%
Total
17,064,000
0.94%
10,459,000
0.95%
Cut-offProba
Grade bl e
0.6%
Total
Cut-off Gra de
17,064,000
0.94%
0.6%
Nemaska Lithium and RB Energy (CLQ) Same Scale Comparison
Sources:
Sources:
Technology Management Group, 2012, Feasibility
Study Updated, NI 43-101 Technical Report
Quebec Lithium Project, La Corne Township
Quebec, October
Canada Lithium Corp. Website:
www.canadalithium.com
Met-Chem Canada, 2014
Feasibility Study on the Whabouchi Lithium Deposit
and Hydromet Plant NI 43-101, June 2014
Nemaska Lithium Website:
www.nemaskalithium.com
Whabouchi Deposit: Vertical Section with Block model Grades
Elev 300 m
Elev 200 m
Elev 100 m
Elev 0 m
Elev -100 m
0m
100m
200m
Whabouchi Deposit Informations
Loca ti on
Ja mes Ba y, Quebec, Ca na da
100% owned
YES
Li fe of mi ne
26 yea rs
Stripping Ratio
2.2 : 1
Li -Hydroxi de producer
YES
Li -Ca rbona te producer
YES
300m
400m
Whabouchi Mineral Reserves
Category
Tonnes
Li2O Grade
Proven
13,300,000
1.54%
Proba bl e
14,000,000
1.39%
Total
27,300,000
1.46%
Cut-off Gra de
0.43%
Quebec Lithium Deposit Informations
Loca ti on
Abi ti bi , Quebec, Ca na da
100% owned
YES
Li fe of mi ne
14.9 yea rs
Stripping Ratio
5.5 : 1
Li -Hydroxi de producer
NO
Li -Ca rbona te producer
YES
Quebec Lithium Mineral Reserves
Category
Tonnes
Li2O Grade
Proven
6,605,000
0.92%
Proba bl e
10,459,000
0.95%
Total
17,064,000
0.94%
Cut-off Gra de
0.6%