China』s largest battery maker has taken a large controlling stake in a lithium project in Quebec, as companies rush to get access to supplies of the key raw material.
The purchase comes as Contemporary Amperex Technology, or CATL, is rapidly expanding its production of electric car batteries with the aim of becoming the world』s largest producer by 2020.
The Ningde-based company is set to raise $2bn through an initial public offering in China this year, valuing it at $20bn.
CATL bought 36.6m shares of North American Lithium from Chinese company Jilin Jien Nickel Industry, to make it a controlling shareholder with over 90 per cent of the shares, according to statements Monday. The Quebec government owns a 5 per cent share in the company.
Jilin Jien Nickel Industry, which bought the company in 2016 out of bankruptcy, said it no longer had the money to fund its lithium project in La Corne Township.
Discovered in 1942, the mine once provided lithium to the US Atomic Agency in the 1950s.
The mine is expected to produce 23,000 tonnes of battery grade lithium carbonate every year, according to the company』s website.
Lithium prices have more than doubled over the past two years due to growing sales of electric cars, especially in China.
The Canadian Environmental Assessment Agency is currently conducting an assessment into the open pit mining project.
Earlier this month CATL invested C$50m into North American Lithium, and an additional C$16m in a convertible bond.