Critical Elements Lithium (CRE) - New Permit Makes Financing Easier

Critical Elements Lithium Corp. is a Canadian mining exploration company focused on advancing its Rose lithium-tantalum project in the Eeyou Istchee James Bay territory in Quebec. The Rose lithium-tantalum project holds 31.47 million tons of mineralisation at 0.91% of lithium oxide (Li₂O) and 148 ppm of Tantalum pentoxide (Ta₂O₅) in the indicated category and 2.7 million tons of mineralisation at an average grade of 0.77% Li₂O and 141 ppm of Ta₂O₅ in the inferred category.  

The 2022 mineral sector may not have been kind to the majority of metals, the lithium space however saw growth compared to its peers. Critical Elements Lithium Corp. believes that the lithium sector will continue to grow in 2023, with it supported by the growth of the electric vehicle (EV) market. The scale of investments in battery manufacturing and electric vehicle manufacturing has not been seen in the lithium space, creating a deficit and opportunity according to the company. Critical Elements Lithium Corp. is also in discussion with various partners regarding offtake agreements, which according to the company shows the potential of the lithium space.

Critical Elements Lithium Corp. has accomplished various milestones in 2022, including the initiation of a 25,000 m drilling program in the summer of 2022 aimed at expanding the mineralisation footprint of the project, testing various targets and further defining the project’s mineralisation. The company also received approval for its rehabilitation and restoration plan, produced lithium hydroxide in pilot plant testing and announced a positive feasibility study for the Rose project including an after-tax NPV8% of USD$ 1.9 billion and after-tax IRR of 82.4%. The company has also received most of the necessary permits for the Rose lithium-tantalum project, with it planning to extend the lifespan of the Rose lithium-tantalum project through various exploration initiatives in 2023.

Critical Elements Lithium Corp. will in the future look to establish a partnership with another company, which will enable an easier path to obtaining the necessary funds required for the capital costs of the operation.

The company will also continue with its envisioned 25,000 m exploration drilling program in the future. The company’s future endeavours will enable it to make a final investment and construction decision, with the first production of spodumene at the Rose Lithium-Tantalum project planned for 2025.

Board of Directors and Management

Jean-Sébastien Lavallée is the Chief Executive Officer of Critical Elements Lithium Corp. and has held the position since 2009. He has been part of the mining environment since 1994 and is a professionally registered geologist. He is well-versed in exploration and has been responsible for the planning and execution of various exploration programs.

Steffen Haber is the President of the company and has previously served as the president and CEO of Rockwood Lithium GmbH. He holds a PhD in Organic Chemistry, obtained from the University of Kaiserslautern in Germany, and is also a fellow of the International Directors Program of INSEAD.

Eric Zaunscherb is the Chairman of the board of Critical Elements Lithium Corp. Zaunscherb has more than 32 years of experience as a geologist as well as 6 cycles as a mining analyst. He previously served as the Managing Director of Research - Metals and Mining Analyst at Canaccord Genuity where he coordinated the firm’s global mining equity research team

Nathalie Laurin is the Secretary and Chief Financial Officer for the company and has more than 30 years of experience in administration and accounting. She has primarily been focused on the mineral sector throughout her career and has served as corporate secretary as well as Chief Financial Officer for several companies.

Marcus Brune and Yves Perron are the Vice Presidents of Finance and Engineering, Construction, and Reliability respectively. Brune holds a PhD in material sciences obtained from the Technical University of Dortmund, Germany. Perron has more than 25 years of experience in project management in the industrial sector and holds both an MBA from Université du Québec in Montréal as well as an Executive MBA from Université Paris Dauphine.

Marc Simpson and Matthew Lauriston Starnes serve as directors of the company. Simpson has more than 23 years of experience in the mining and exploration industry and has been involved in Junior, Mid-tier and Senior mining companies globally. Starnes is a lawyer with more than 22 years of experience in mining law.

Ani Markova, Maysa Habelrih and Vanessa Laplante are recent additions to the company’s board of directors. Markova is a director of the company and is a portfolio manager with more than 15 years of experience in the mining and metals sector. She is a specialist in ESG values and the reporting and integration thereof in company operations. Habelrih has a track record of delivering operational excellence and transforming business objectives into bottom-line growth. She previously served as the General manager for Rio Tinto Aluminium with full governance and fiscal accountability for nine joint venture operations globally, featuring USD$ 2 billion in revenues. Laplante brings with her more than 30 years of experience in finance and taxation which includes 16 years in the mining industry. She has been the Chair of the Tax Committee of the Association Minière du Québec since 2011 as well as the Chair of the board of directors.

Zaunscherb explains the company’s board of directors as one of the best in the lithium industry.  

“I think we've got a situation where a company has one of the best boards out there for a lithium developer and our project, there's one of very few if any other projects that now have all of their key permits in place and are ready to go.”

The Lithium Market

The 2022 mineral sector may not have been kind to the majority of metals, the lithium space however saw growth compared to its peers. Critical Elements Lithium Corp. believes that the lithium sector will continue to grow in 2023, with it supported by the growth of the electric vehicle (EV) market. Zaunscherb explains that the scale of investments into the battery manufacturing and electric vehicle manufacturing sectors has not been matched in the lithium space, creating a deficit and an opportunity for lithium companies.

“It's quite clear that demand for electric vehicles is extremely strong, and continues to grow, and if you look at the investments that are being made by the OEMs, by the Original Equipment Manufacturers, into the manufacture of vehicles and the investment that's going into battery materials and battery manufacturer, it's enormous and what hasn't kept pace is an investment into raw materials going into batteries and that includes Lithium…”

Critical Elements Lithium Corp. is in discussion with various potential partners regarding future offtake agreements, according to Zaunscherb, which further shows the demand for lithium from an industry standpoint.

“…the point I'm getting at is that we have a lot of parties interested in the Rose project that we are in discussions with and if anything, that is the greatest indicator of demand on a granular basis. We are seeing an enormous amount of interest in gaining the offtake from the Rose project.”

The Rose project and permitting

The Rose Lithium-Tantalum project is an envisioned open-pit and traditional lithium processing operation located in Northern Québec near James Bay. The project is accessible year-round by road and is located approximately 50 km away from the Nemiscau airport. The project has a land position of 24,654 hectares and consists of 473 claims.

The project holds 31.47 million tons of mineralisation at 0.91% of lithium oxide (Li₂O) and 148 ppm of tantalum pentoxide (Ta₂O₅) in the indicated category and 2.7 million tons of mineralisation at an average grade of 0.77% Li₂O and 141 ppm of Ta₂O₅ in the inferred category.  The project also holds a positive feasibility study which includes an after-tax NPV8% of USD$ 1.9 billion and an after-tax IRR of 82.4%.

Critical Elements Lithium Corp. announced on the 2^nd of November 2022 that it had received the Certificate of Authorization for the project from the Quebec Minister of the Environment. The company also received approval for the project’s rehabilitation and restoration plan from the Quebec Minister of Natural Resources and Forests on the 13^th of May 2022. Zaunscherb explains that the two permits are the main permits required for the envisioned operation, with the receival thereof significant.  

“Those are the 2 main permits that are required. There are several smaller permits that are sort of on the municipal and provincial level but really, the process, the extensive due diligence done in the case of Quebec by the committee called Komax, that was a 5-year, just under a 5-year process and involved several rounds of questions and answers. That is now complete and with a positive recommendation that the government, the provincial government agreed with. That's the main, those 2, the federal and the provincial permits are the key permits, minor permits to come.”

Exploration plans

Critical Elements Lithium Corp. initiated a 25,000 m drilling program in the summer of 2022 which has a three-pronged approach, according to Zaunscherb. The first is the expansion of the mineral deposit of the Rose lithium-tantalum project itself as well as its satellite mineral deposits.

“One is to expand the footprint of the Rose deposit itself to the north and northeast but also the satellite deposits that are found within 10 kilometres off roads. So, we're quite confident that we should be able to add to the mine life between the Rose extension and the satellites in the immediate area.”

The second is the company’s focus on its Lemare project, which aims to delineate an initial mineral resource at the project through its initiatives.

“Lamar, we hope to drill this winter and come up with an initial resource for that deposit. It has already had a number of drill holes into it which are demonstrating grades similar to Whabouchi and so, we are confident that we'll be able to put together an interesting deposit there…”

The final aspect of the exploration initiatives will be the exploration of targets that were produced through the AI analysis of the company’s properties.

“We had artificial intelligence or machine learning applied to the 700 square kilometres of property that Critical Elements and that process took all of the data into consideration from the past and came up with what are called smart targets. So, we know already from sampling that we have extensions to what may be the Whabouchi deposit itself to the southeast and we have multiple smart targets that represent pegmatites that are bearing spodumene on the surface and so, the third leg for that exploration will be to test these targets.”

Future

Critical Elements Lithium Corp. will in the future look to establish a partnership with another company, which will enable an easier path to obtaining the necessary funds required for the capital costs of the operation.

“One is, the first will be not in terms of chronology but one of the key catalysts will be some form of partnership that addresses CapEx and that will be a very important milestone.”

The company will also continue with its envisioned 25,000 m exploration drilling program in the near future which is planned to extend the lifespan of the Rose lithium-tantalum project. The company’s future endeavours will enable it to make a final investment and construction decision, with the first production of spodumene at the Rose Lithium-Tantalum project planned for 2025.

“Secondly, there will be exploration results that demonstrate additions to the life of the Rose project. This is what we hope for. This is speculation. And secondly, we speculate that we'll be able to put together a resource, an initial resource on the Lemare deposit. And thirdly, that we'll be able to demonstrate that the 700 square kilometres that we control have additional Roses for the bouquet, that there is a potential for multiple operating centres within that property.”

To find out more, go to the Critical Elements website