Mitsubishi is buying a $25-million, 7.5-per-cent stake in Frontier Lithium’s PAK Lithium mining project, according to a joint statement from the companies today.
The investment is part of an agreement between the two companies to form a joint venture partnership to advance both a proposed lithium mine, located 175 kilometres north of Red Lake, Ont., and a planned lithium chemicals conversion facility.
Under the terms of the agreement, Mitsubishi will have the option to increase its ownership stake in the PAK project up to 25 per cent (and get a corresponding 25 per cent off take from the project) upon completion of the definitive feasibility study. For Frontier Lithium, the investment gives it the short term cash flow needed to advance the project.
“This process has been going for a while to really do the due diligence,” says Bora Ugurgel, senior manager of investor relations at Frontier Lithium, in an interview with Electric Autonomy.“We really landed on Mistubishi because there’s overwhelming alignments on the strategy, the culture and what we want, they want to build something meaningful. This is their first investment into lithium and it’s in Canada and is to our project. It speaks volumes.”
The agreement comes on the heels of Canada and Japan signing a memorandum of co-operation last October. In the past two years, Mitsubishi also invested in a copper project in Yukon and a nickel project in northern British Columbia.
“You’re going to see more of that uptake of Japanese investment into Canada. It makes Canada investable again on critical minerals because we had not seen that in a while,” says Urgugel.
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