Nemaska Lithium (TSE: NMX) announced on Monday it has terminated a multi-year supply agreement with Livent Corporation that would cost the Quebec company up to $20m to settle.
The deal with Livent, spun out of US lithium major FMC Corp last year, saw Nemaska provide up to 8,000 tonnes per year (28,000 tonnes in total during the term of the contract) of lithium carbonate starting in April this year.
According to a press released late on Monday, Nemaska told Livent it “might have no option but to terminate” the agreement and repay Livent the USD$10 million the it received in April 2017 “plus a similar amount as a termination fee”.
Nemaska said “despite good faith negotiations, [it] was unable to reach a mutually satisfactory outcome with Livent” and that Livent “is seeking arbitration, which Nemaska “will vigorously defend.”
North American equity markets were closed on Monday for a public holiday, but Nemaska investors could feel more pain when markets open on Tuesday. Last week shares in Nemaska plummeted after disclosing it had been forced to revise the budget for the Whabouchi hard rock lithium mine and Shawinigan electrochemical plant upward by C$375 million.
For the rest of this article: http://www.mining.com/canada-lithium-mining-hopeful-takes-another-big-hit/