– FMC Corporation (NYSE:FMC) announced a new long-term supply agreement with Nemaska Lithium, Inc. Under the agreement Nemaska will provide FMC with 8,000 metric tons per year of lithium carbonate beginning in mid-2018. “This agreement will further diversify our supply sources while fueling our growing production of high quality, specialty lithium products,” said Tom Schneberger, vice president and global business director of FMC Lithium. “We look forward to partnering with Nemaska on this important supply arrangement.” Based in Quebec, Canada, Nemaska Lithium, Inc. is constructing new lithium production capabilities of 28,000 metric tons of lithium carbonate equivalent.
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Nemaska Lithium Inc. (TSX:NMX)(OTCQX:NMKEF), via its wholly owned subsidiary Nemaska Lithium Shawinigan Transformation Inc. (collectively "Nemaska Lithium" or the "Corporation"), announces that FMC Corporation ("FMC") will pay a lump sum of US$10,000,000 to Nemaska Lithium (the Payment) by April 7, 2017, in accordance with the Supply Agreement announced on October 31, 2016, and has agreed to amend the Supply Agreement to extend the timeline for the supply of product thereunder.
Under the Supply Agreement, as amended, Nemaska Lithium will begin to supply FMC with lithium carbonate no later than April 1, 2019. Nemaska Lithium will also provide lithium carbonate samples from its Phase 1 Plant to FMC for qualification in 2017.
The Payment will be secured by a first rank hypothec (lien) on the Corporation's lithium carbonate and hydroxide inventory and the proceeds thereof. If Nemaska Lithium does not fulfill its delivery obligation under the Supply Agreement, as amended, it shall repay FMC the Payment plus a penalty calculated as per that agreement.
"The Payment and the supply period extension show that FMC, a major credible lithium producer, has continued confidence in our project and business relationship. The lithium market needs new producers, such as Nemaska Lithium, to come on stream over the next few years to keep up with the ever growing demand from the lithium ion battery market. Nemaska Lithium is committed to meeting the needs of its customers and we are on track to commence the commissioning of the Shawinigan Hydromet Plant during the second half of 2018, with production from the Whabouchi Mine commencing in the first half of 2018," commented Guy Bourassa, President and CEO of Nemaska Lithium.
