Canadian mineral development company Avalon and Belgian mining company Sibelco have completed their previously announced joint venture (JV) deal.
The new SRL JV will see Sibelco own a majority stake of 60% while Avalon will own 40%.
It can now advance mining activities at the Separation Rapids deposit near Kenora, and the Lilypad Project located near Fort Hope, Ontario, Canada.
Avalon and Sibelco announced the JV agreement in June 2023.
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The duo also signed a binding term sheet in June, which saw Sibelco buying C$10m of Avalon shares in a placement, constituting 19.9% of the business.
It was also offered a secured convertible debenture in the principal amount of C$3m.
Avalon will utilise the placement proceeds for purchasing industrial land for the Thunder Bay lithium-hydroxide processing facility and repaying up to C$1.9m in debt.
Meanwhile, Avalon transferred its Separation Rapids and Lillypad projects, including all property, contracts, permits, books and records, for a consideration of €23.2m, representing a 40% stake to the JV entity.
The JV is claimed to be in a position to supply petalite-lithium to both the glass and ceramics industry, as well as to the North American electric vehicle (EV) battery manufacturing industry.
It will own, commercialise and generate revenue from the mineral assets at both projects. The petalite-lithium output from Separation Rapids is expected to suffice both glass and ceramics and battery markets.
Avalon stated that the JV opens up a new path to generate revenue from long-held assets and to unlock value for its shareholders.
Sibelco chief strategy and business development officer Ian Sedgman said: “Separation Rapids represents a unique opportunity for Sibelco to enhance a core business we know extremely well, while at the same time, providing us with an entry into the promising North American EV battery market. It is a dual-market strategy we are confident will create long-term value for all stakeholders.”
Avalon CEO Scott Monteith said: “Through this exciting joint venture, and after years of exploration and patience, the unique and valuable petalite deposit at Separation Rapids will finally be commercialised for the benefit of all stakeholders and the Ontario community at large.
“We are unlocking the potential of Separation Rapids and other projects, and in so doing, taking another key step in establishing the end-to-end lithium supply chain we envision for Ontario.”
Separation Rapids is the flagship deposit of SRL. Located 70km from Kenora, Ontario, the deposit has a mineral resource estimate of 10.08 million tonnes of petalite with a lithium grading at average of 1.35%.
The project is also expected to contain several minerals such as high-purity silica, rubidium feldspar, caesium and tantalum.
The Lilypad project is located near Fort Hope, Ontario. It has 14 claims, including 166 new claim units and covers over 3,299ha.
The minerals at the project comprise lithium, tantalum and caesium mineralised pegmatites.
This project is also considered to have one of the few known significant occurrences of caesium ore mineral pollucite.