Nemaska Lithium Inc NMKEF

Fitzgibbon

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Dec.24/19 - SHAWINIGAN The Nemaska Lithium project remains relevant to meeting global growth in demand for electric vehicles, but it clearly needs to go through a painful restructuring to clean up its business plan, according to the Minister of Economics and Innovation, Pierre Fitzgibbon....... "This is a very important project," he reiterates. "The company decides to protect itself from its creditors because, unfortunately, its capital structure is very deficient. We remember the $375 million increase in costs... There are a lot of people interested, but when you look at the structure, there are bonds at very high rates, at 11.25 per cent. The company has money to continue for a while. It should be considered more likely to have new financing with protection like this to review certain arrangements with certain creditors."....... "The company has been trying to find additional funding with the current structure," the minister said. "Obviously, she didn't succeed. Investors want some structural redevelopment, which the company will do in the coming months."...... In 2018, the Quebec government announced an $80 million investment in Nemaska Lithium's equity. Resources Quebec had also underwritten $50 million in bonds, as part of a total financing of $1.1 billion at the time. Last February, however, the company announced that it needed to find partners to face $375 million in cost overruns to complete its projects at the Whabouchi mine and its Commercial Plant in Shawinigan......."I just came from a tour of Asia to talk about electric vehicles and it's clear that lithium is as interesting as it was six months ago," says Fitzgibbon. "The price is very low right now, but it's a circumstantial aberration. Vehicle penetration is still growing. If we look five years ahead, it will be an important commodity. Lithium will always be an important part of batteries."...... At the moment, however, there is global overproduction. The Minister of Economy and Innovation remains convinced that Quebec's mining company will have a place in this highly competitive market...... "I've met more than 40 companies in Asia," he says. "When you look at the anticipated growth in the conversion of gasoline and electric vehicles and look at the implication of that on lithium, it's clear that there will be additional needs, there's no doubt about it."........ "There are a lot of equipment manufacturers who want to integrate vertically, having some stake in a mine to secure their lithium supply," he adds. "It's still a strategic number that needs to be exploited."...... In this context, there is no question of abandoning a similar project, so close to the goal..... "The government has always been interested and it is still interested," the minister said. "We're still looking for partners. Quebec is super attractive, if only for its clean energy. We have a competitive advantage."...... "Of course, we want it to happen quickly," he concludes. "But there is no race either. Between 2025 and 2030, we are talking about a conversion rate of 30% to 35% of vehicles. Lithium is a strategic ore. There is no doubt that it will be necessary, but we will have to be competitive."

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Lithium is a strategic resource for Quebec. Our government understands the importance of harnessing and transforming our resources. We will be there to participate in the funding and are following the issue closely.

[rosaria22]

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