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Euro Manganese accelerating plans for Quebec battery materials plant

Euro Manganese accelerating plans for Quebec battery materials plant

Battery materials specialist Euro Manganese [TSXV/ASX: EMN] has completed a scoping study evaluating the development of a dissolution plant in Bécancour, Québec which is capable of producing 48,500 tonnes per annum of battery grade manganese sulphate.

The scoping study delivered strong preliminary project economics with a post-tax Net Present Value of C$190 million and a post-tax Internal Rate of Return of 26%, the company said yesterday.

Euro Manganese also said it has selected WSP Canada Inc. to complete a feasibility study for the plant, which will further refine plant design, costs, economics, and customer off-take opportunities.

In addition, it has signed a Memorandum of Understanding with MMC, a South African producer of high-purity electrolytic manganese metal, to supply the Bécancour plant with battery-grade, selenium-free, 99.9% HPEMM feedstock. HPEMM is an already refined metal product that requires further processing to produce battery grade manganese sulphate.

“Our growth plans to supply the North American lithium-ion battery market with high-purity manganese are advancing,” said Euro Manganese CEO Dr Matthew James. “Completion of the Bécancour Plant scoping study, preparing for the feasibility study, and signing the MoU with MMC lays the foundations to deliver significant additional value for our stakeholders. The MoU provides us with feedstock flexibility and enables us to potentially operate Bécancour as a stand-alone project. More importantly, it outlines a potential pathway to bring company production and cash-flow forward by at least a year, in advance of our Chvaletice Manganese Project in the Czech Republic.”

James said that while flagship Chvaletice Project remains at the heart of the company’s focus, the Bécancour Project advances its vision of building a leading, multi-asset high-purity manganese business to supply the rapidly growing EV market.

The MoU is strategically significant for Euro Manganese as it enables the potential acceleration of the plant to supply the North American market, possibly as early as mid-2026, thus bringing forward cash flows for Euro Manganese.

Euro Manganese has signed a cooperation agreement with the Grand Conseil de la Nation Waban-Aki, a tribal council of the Abenaki communities, on whose ancestral territory the Bécancour Project would be situated.

Leading battery materials hub

Bécancour is fast becoming a leading battery materials hub within Canada and the company’s site is strategically located adjacent to a cluster of planned cathode active material manufacturing plants. Euro Manganese said that the Bécancour Plant could produce up to 20% of projected North American 2027 demand for HPMSM.

The CPM Group forecasts demand for North American HPMSM to rise to approximately 250,000 tpa in 2027 and over 800,000 tpa by 2031. American EV tax credits from the Inflation Reduction Act have stimulated growth of the North American EV vehicle market and the upstream supply chain. However, there remains no current processing capacity or production of battery-grade manganese in North America.

Bécancour plant: short build time confirmed

The plant site is a 15-hectare land parcel within the Bécancour industrial park on which Euro Manganese has an option agreement to purchase. The company has also completed site due diligence. Initial capital was estimated at C$110.8 million, including contingencies of C$15.1 million. A key aspect of the plant is a short build time; the study estimated an approximate two-year engineering/construction duration.

The plant design allows for production of both high-purity manganese sulphate monohydrate crystals and high-purity manganese sulphate solution, which provides customer offtake flexibility. The design leverages extensive process development and engineering work already completed for the Chvaletice manganese project in the Czech Republic.

Producing HPMSS provides both cost and environmental benefits. An HPMSS product could be pumped as a solution to nearby precursor cathode active materials manufacturers, which eliminates the need to crystallise, dry and package an HPMSM product. As HPMSM is ultimately dissolved in water by pCAM plants, delivering a solution saves costs and reduces water consumption and CO2 emissions.

Minimal infrastructure improvements are required to build the plant, Euro Manganese said. Offsite infrastructure is limited to a power line connection from the main Bécancour power distribution network and the potential construction of a railway spur from the Bécancour site railway line. Onsite infrastructure includes roads, plant and administrative buildings, power distribution and storage buildings for HPEMM feedstock and HPMSS/HPMSM products.

Feedstock optionality via a third-party metal supply was modeled, which may facilitate operation of the Bécancour Plant as early as mid-2026, ahead of the CMP. This would potentially enable Euro Manganese to be first to market in North America and bring projected cash flows forward by at least a year. This projected timeline and feedstock mix will be assessed as key outputs of the feasibility study, which is expected to be complete in mid-2024, subject to financing.

Bécancour is fast becoming a leading battery materials hub within Canada due to the excellent regional infrastructure, the green and competitively priced energy, a very supportive government with grant programs, and with a qualified local work force. The site is strategically located adjacent to a cluster of planned cathode active material manufacturing plants, including GM/Posco and BASF.

MoU with MMC

Euro Manganese has signed an MoU with MMC, a South African producer of HPEMM, to supply the Bécancour plant with battery-grade, selenium-free, 99.9% HPEMM feedstock. The MoU provides feedstock optionality, allowing it to be fed with HPEMM from MMC and/or with HPEMM from Euro Manganese’s Chvaletice project. The MoU allows for flexibility on the supply of HPEMM depending on market demand, MMC product availability, and CMP metal sales.

The MoU is being hailed as strategically significant for Euro Manganese as this third-party metal supply enables the potential acceleration of the plant to supply the North American market possibly as early as mid-2026, thus potentially enabling the company to be first to market and to bring cash flows forward.

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