Quebec lithium mine’s bankruptcy flags Canadian market obstacles, analysts say – by Kip Keen (S & P Global – May 8, 2020)

In Nemaska Lithium Inc.’s failure to launch a lithium mine in Quebec, analysts see some of Canada’s disadvantages in the global lithium market coming to bear. The company headed into creditor protection in late 2019 after spending about C$411.4 million on the C$1.27 billion Whabouchi lithium project as of Dec. 31, 2019.

Remote project locations lacking infrastructure and proximity to end markets, in particular China, along with weak lithium prices remain obstacles for the budding sector in Quebec and other parts of North America, according to analysts.

Benchmark Mineral Intelligence lithium analyst Andrew Miller said many factors have played a role in holding back some of Quebec’s potential lithium supply to the global market.

Key among them is the relative cost advantage of projects in mature lithium-producing regions such as Australia, South America and China compared to Canada’s more remote offerings.

In Australia’s case, its mines are closer to end markets, while they also may have better access to transportation infrastructure, Miller said. “They have the infrastructure and they’ve been able to quickly ramp up to scale,” Miller said. ”

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