A global over-reliance on China became evident throughout the pandemic. With over 20 years of experience in the sector, how do you view the landscape shifting to mitigate this?
China became leaders in the production of non-traditional commodities like rare earths because they built out the downstream processing and manufacturing capacity for the end use products such as high strength permanent magnets. There have never been any end-users in Canada for these non-traditional commodities in the past, making it difficult for mineral developers to get production started. However, when the Ontario government announced they had attracted interest from some of the manufacturers of both the batteries and electric vehicles, to set up operations locally, it was based on providing assurance that the Province would support establishing the critical materials supply chains. It will become a win-win for the whole province if we can create more economic development in the south that relies on critical minerals supply chains developed from the abundant resources in the north.
How is the development of the Avalon Advanced Materials refinery evolving and what impact do you think it can have in the whole region?
We have been promoting the idea of getting the midstream processing capacity established for lithium battery materials in Thunder Bay, a central location in Northwestern Ontario with excellent transportation infrastructure to access both domestic and international markets.
Avalon can create the initial supply of lithium mineral concentrates from its Separation Rapids Project to get battery materials production started, but there is no shortage of other lithium pegmatite resources in northwestern Ontario that can create additional supply, as they occur in abundance throughout the entire Canadian Shield.
They also do not necessarily have to be developed as giant open pit mines, but rather, as a number of relatively small, medium-sized quarries that will produce no toxic wastes. New technologies also allow to concentrate the minerals of interest very efficiently, without using any chemical reagents.
Our plan is to have a major company as an investing partner. We signed a Letter of Intent (LOI) in April with a company very keen to work with us. Once we get the ball rolling and prove we can produce the lithium hydroxide product, we will receive more potential partner interest as well as off-take interest and get support from both the federal and provincial governments.
Which major roadblocks is the sector facing to keep transitioning into the green economy?
The sector has historically not been well understood in government circles, in terms of what it takes to get supply chains started with non-traditional commodities like lithium. While it involves taking some rock out of the ground, afterwards it is all about how you process the material to turn it into the derivative products needed in new technologies. Taking a bulk sample early on, and then showing how you can process it to make the product that will meet the needs of the market, is a key first step. However, the Mining Act blocks you from doing this, because it assumes you are about to start a giant open-pit mining operation. That was the main point that earned the traditional mining industry a bad reputation -- you only ever developed the resource at the largest possible scale to keep your average cost of production as low as possible. However, with non-exchange-traded commodities, it does not have to be that large and defining a product that will be saleable is the key step to getting operations started and the scale is defined by the market demand, not the size of the resource. This is the main point I have been communicating on how the regulations need to change.
The government must recognize that this type of mining needs to be regulated differently than traditional exchange-traded bulk commodities. Ontario, and the federal government, are creating new critical minerals supply chain strategies that are now recognizing this.
How is the re-processing of historic mine wastes creating a new opportunity for mining companies?
Historically, there has not been much innovation in the traditional mining industry. New mines were typically designed to produce one commodity and not much attention was paid to other elements in the resource that would usually end up in the tailings. This is why historical mine wastes are so interesting now. There are many examples of elements that had no value decades ago, but do today. It requires quite a bit of test work, just to find what is present in the tailings and waste rock piles; and then analyze how one can recover them efficiently. Using technologies like sensor-based ore-sorting, and dense media separation; one can optimize processes and allow for more efficient disposal of whatever waste is left, to ensure it is not creating any new environmental hazards.
The federal government now appreciates that this is a way to create the circular economy in the mining industry by allowing closed mine sites to be reactivated, to extract value from the wastes, while remediating the long-term environmental liability.
What final message would you give to our international Newsweek readership?
There is no shortage of lithium resources. It is all about finding them, then defining efficient ways to recover the lithium, to turn it into the derivative products needed in the battery technologies sector. Avalon, with its advanced Separation Rapids Lithium Project is well positioned to get the supply chain started in Ontario now that we have an investing partner and lots of demand for the lithium hydroxide product. It will take 3 years to get our regional refinery in Thunder Bay started, but once we do, it will be a growth industry that can serve consumers both here in North America, and also internationally, in Europe. No doubt about it!
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