The corporate mentioned final week it plans to construct a ten,000-tonne-per-year iron phosphate plant 20 km from the deep-sea port of Saguenay. The plant is to function a part of First Phosphate’s deliberate vertically built-in operation, remodeling phosphate from its proposed mines into cathode energetic materials (CAM). First output for the batteries that energy about three-quarters of electrical automobiles is predicted in early 2026.
The corporate goals to make battery-grade phosphoric acid from igneous rock, which is confined to a couple accessible locations within the West, CEO John Passalacqua mentioned throughout a presentation on Thursday in Toronto. It’s totally different than the fertilizer kind of phosphate that comes from sedimentary deposits.
“These things is rarer than gold,” Passalacqua mentioned. “Eighty % of all of the batteries on the earth at the moment are LFP. There’s not going to be phosphate wherever to provide these LFP batteries. Why would I not be bullish?”
Inexpensive
Whereas LFP batteries have a decrease vitality density than lithium-ion batteries, they’ve gained market share as a result of they’re cheaper to provide. Adherents to the battery chemistry embody Tesla CEO Elon Musk and Chinese language EV big BYD.
A part of Passalacqua’s argument is that LFP batteries are extra widespread for cheaper autos than nickel-manganese-cobalt batteries, which is able to possible stay amongst higher-end automobiles and SUVs. The corporate expects North American demand for LFP CAM to achieve 1 million tonnes a yr valued at $24 billion by 2033, with none produced on the continent now. One other plus is that whereas automobiles take about 20% of provide, 61% goes to long-term vitality storage the place nickel-manganese-cobalt batteries aren’t used.
The availability of phosphoric acid, which can also be utilized in delicate drinks, cereal and hearth extinguishers, is at capability globally however should double by 2045 to satisfy battery calls for, in response to analysis by CRU.
“LFP is so efficient, it’s so priceless, it’s so price efficient, that it may possibly meet a complete gamut of means for electrification,” Passalacqua mentioned. “And that’s why we’re in there. We will steadiness out our dangers.”
Lac à l’Orignal
The corporate’s essential phosphate mission, Lac à l’Orignal, 84 km from Saguenay, would produce a median of 425,000 tonnes of phosphate focus a yr with a phosphate content material of over 40%, in response to a preliminary financial evaluation from July 2023. The mission would additionally produce 280,000 tonnes of magnetite and 97,000 tonnes of ilmenite over a 14-year mine life.
It will generate an after-tax web current worth at a 5% low cost price of C$511 million and an inner price of return of 17.2%. Pre-production capex was pegged at C$550 million with an after-tax payback of slightly below 5 years.
The corporate has a market capitalization of C$20.6 million on the CSE. Its shares closed flat Thursday at C$0.28 apiece. They’ve traded in a 52-week vary of C$0.15 to C$0.48.
Lac a l’Unique has an open-pit constrained useful resource of 15.8 million indicated tonnes grading 5.18% phosphate (P2O5), 23.9% iron oxide (Fe2O3) and 4.23% ilmenite. Inferred assets measure 33.2 million tonnes grading 5.06% P2O5, 22.55% Fe2O3 and 4.16% ilmenite.
At Bégin-Lamarche, First Phosphate has found 4 essential zones with a number of open-pit accessible phosphate-bearing layers and has accomplished greater than 30,000 metres of drilling over the past yr and a half.
The CEO described it as a 2-km lengthy floor deposit the place drilling has solely pierced to 250 metres and has a lot additional to go.
Plant feed
The proposed plant’s preliminary feedstock will likely be sourced from third events however will ultimately come from Bégin-Lamarche as early as 2028, the CEO mentioned. The 28,000-sq.-metre industrial plant, the place it has a renewable 10-year lease, requires an estimated $65 million in retrofitting.
First Phosphate has began a feasibility research with Ultion Applied sciences to finalize infrastructure necessities. The plant’s expertise has already been confirmed at two different services globally, permitting First Saguenay to maneuver on to large-scale manufacturing and not using a pilot part.
In January, First Phosphate inked a cope with American Battery Manufacturing unit of Utah and UK-based Integrals Energy to provide lithium iron phosphate cathode materials and LFP battery cells.
The proposed plant is a couple of kilometres from Canadian Air Forces NATO Base Bagotville, which through the Second World Conflict helped shield native producers supplying 85% of Allied aluminum for plane. German U-boats had been mentioned to have fired on the vegetation, Passalacqua mentioned.
“Now it’s a distinct equation, however what do we’ve?” the CEO mentioned. “We’ve bought direct logistics down right here to Detroit to automaking, with 50 km from the place the mine will likely be is an intermodal station the place the vehicles get onto the rail automobiles. We’re packed into all that infrastructure.”