THUNDER BAY — Two mining companies are eyeing Thunder Bay as a potential location for a lithium chemical plant.
It would be the first operation of its kind in North America, processing concentrates shipped from two sites in Northwestern Ontario to produce lithium sulphate, a precursor chemical for lithium-ion batteries.
Avalon Advanced Minerals, based in Toronto, and Vancouver-based Rock Tech Lithium have entered into a letter of intent to collaborate.
Avalon is developing the Separation Rapids lithium project, 70 kilometres north of Kenora, while Rock Tech owns the Georgia Lake lithium project in the Beardmore area.
They are two of the three largest lithium deposits in Ontario.
John Mason, project manager for mining services at the Thunder Bay Community Economic Development Commission, says a processing plant could create about 100 jobs.
In an interview Monday, Mason said it also holds the potential for spinoff manufacturing to happen in the city, using lithium carbonate or lithium hydroxide.
"Those products would lead to the possibility of value-added. Could we have a battery facility, that's the big question, in lockstep with an industrial mineral project on the waterfront? It could be huge for Thunder Bay."
Mason noted that car manufacturers such as Ford and Fiat-Chrysler recently announced plans to manufacture electric vehicles in Ontario.
Several existing industrial properties on Thunder Bay's waterfront are considered potential sites for the plant.
The companies are looking at both privately-owned and city-owned land.
However, if the project proceeds, construction will likely still be at least two years away.
Avalon CEO Don Bubar said the companies are still developing their projects, must design the production process and conduct tests on the product, and strike deals with battery manufacturers.
"It's not an easy thing to get a new operation started until you have more certainty on their being downstream consumers of the product. For a long time there wasn't any. That's changing now."
Bubar said there's growing interest in both North America and Europe in expanding capacity for building electric batteries.
Avalon has been looking at supplying the North American market, and Rock Tech is interested in the overseas market.
The two first started talking about a collaboration at this year's meeting of the Prospectors and Developers Association of Canada.
"It made a lot of sense, because the capital requirements are pretty intimidating for one company to take on all by itself," Bubar said.
He visited Thunder Bay this summer to look at potential building sites and examine the availability of necessary infrastructure.
Bubar said the plant would not produce any toxic waste.
He believes it would eventually become a processing site for other lithium concentrate producers across Northern Ontario.