MONTREAL – Quebec is in line to win two projects together worth about $350 million to provide key materials for the next stage of the high-tech revolution.
The Bécancour Industrial Park midway between Montreal and Quebec City may get a rare-earth metals refinery requiring investment of well over $200 million and creating about 300 new jobs.
Innovation Metals Corp., a Toronto-based private company, plans to set up the world’s first independent centralized rare-earth ore separation plant in the park, attracted by Quebec’s low industrial power rate and proximity of road and rail connections. Bécancour already has a producer of hydrochloric acid and caustic soda, two key chemicals for the refinery.
Montreal consultants Genivar Inc. chose Bécancour over several competing sites in Ontario, IMC said, and is managing the environmental impact assessment process. Soaring prices for rare earths, used in products from iPods to new-generation batteries for hybrid and electric cars, have created a two-year global exploration boom. Many deposits have been found in Quebec and other parts of Canada, but extraction and separation of the rare-earth metals is expensive and difficult technically.
China, the main producer, recently cut export quotas to conserve supplies and force domestic industry consolidation.
This raised international alarms and prices have eased this year with a slowing world economy. But most analysts expect demand to soar again over the medium term as Asia Pacific growth gets back on track.
IMC’s CEO Patrick Wong said the Bécancour “tolling” refinery, with annual capacity of 15,000 tonnes of high-value “heavy” rare-earth elements, will ease a bottleneck in the supply chain. The plant, using solvent extraction technology, will be centrepoint between the mining companies producing rare earths in concentrate form and end-users of the refined products.
Prices would be negotiated between them.
“A number of potential rare-earth producers have shown strong interest in low-cost tolling facilities,” he said.
The environmental review should be ready in 18 months and feasibility studies will follow.
Varennes, also on the South Shore and nearer Montreal, may host a graphite purification plant planned by Ottawa-based Focus Graphics Inc. and using technology licensed by IREQ, Hydro-Québec’s research arm.
Focus will invest about $130 million to develop its Lac Knife graphite property, 35 kilometres south of Fermont, in the Quebec-Labrador iron ore belt, into an open pit mine and build the Varennes refinery to produce 99.9-per-cent-pure metal for the new-generation lithium-ion battery market.
Graphite is best known as an industrial material, but rising global demand has doubled the price over the past three years and spurred exploration for new sources.
“There are hundreds of uses for graphite but the high-purity product is a key ingredient of the lithium-ion batteries powering smart phones, notepads, power tools and hybrid and e-cars,” Focus CEO Gary Economo said.
“That’s where the long-term growth is.”
The Lac Knife property has ample reserves of high-grade ore that can be upgraded to 99.9 per cent at the refinery at a competitive cost, he says. Initial treatment of the ore will be at Fermont and the concentrates will move by rail and ship to the Varennes refinery. Focus might also make battery anodes.
The refinery will have annual capacity of 25,000 tonnes and Focus is shooting for a 2014 startup, Economo said.
Toronto-based engineers Roscoe Postle Associates Inc. will plan the Fermont mine.
“The graphite mining sector has changed dramatically over the past year with many new entrants responding to rosy estimates of market growth,” he added.
“Price, quality and availability are the keys and Lac Knife will be the lowest-cost producer of technology graphite.”