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2023 has been nothing short of impressive for LFP battery mineral developer First Phosphate (Canada: PHOS)(Frankfurt: KD0).
The Company continues to deliver value to shareholders through the development of phosphate mining and concentration infrastructure, proving the usefulness of its high-quality phosphate deposits, and establishing partnerships with world-class industry leaders.
This unwavering focus places them in an excellent position to be a key player in the $68.9 billion LFP battery market and you have an opportunity to invest before it happens.
Today, we’ll uncover all that First Phosphate has accomplished in the first half of 2023 and offer you a glimpse into its upcoming production strategy.
The world is on the verge of a clean energy revolution and First Phosphate is at the forefront of it.
First Phosphate Overview
First Phosphate is a mineral development company fully dedicated to extracting and purifying phosphate for the production of cathode active material for the Lithium Iron Phosphate (LFP) battery industry.
The Company owns 1,500 square kilometers of royalty-free land claims in the Saguenay–Lac-St-Jean Region of Quebec, which is home to the rarest form of rock phosphate in the world (1% of the global supply).
These particular phosphate deposits are devoid of harmful trace elements that are otherwise quite harmful to the environment, making them well-suited to meet North American Inflation Reduction Act standards.
Its two flagship phosphate properties are Bégin-Lamarche and Lac à l’Orignal.
Both properties are strategically situated near advanced infrastructure, including heavy-haul road networks, the deep sea port and airport of Saguenay, and the low-to-no-carbon-emissions Quebec Hydro grid.
The positioning of First Phosphate’s projects not only helps them significantly cut operating expenditures but also opens its high-value products to the international markets.
During recent drill results, Bégin-Lamarche yielded some of the highest phosphate grades ever found in the Saguenay-Lac-St-Jean Region, while Lac à l’Orignal achieved beneficiated phosphate purity levels of 40.2%.
When beneficiated, these high-grade deposits can reach purity levels of 38% to 42% (ie. the Lac à l’Orignal results), making them perfectly suited for manufacturing large quantities of purified phosphoric acid for LFP batteries—over 85% of the feedstock is recovered during beneficiation.
The Company’s projects also host key secondary minerals like ilmenite (∼39% TiO2) and magnetite (∼68% Fe) which have the potential to be upgraded into iron sulphate and iron powder, both of which are equally valuable material inputs in the LFP Cathode active material production process.
If feasible, these secondary recoveries will greatly reduce the cost of production for First Phosphate phosphate concentrate since they are relatively scarce resources in North America.
Overall, First Phosphate intends to create a vertically integrated production plan, that begins with extracting the phosphate, and secondary recoveries, from the Earth, then beneficiating and refining it, and eventually manufacturing LFP cathode active material to be used in LFP batteries.
After that, the Company will sell its product to, or partner with major LFP battery and EV manufacturers in North America and beyond.
First Phosphate is led by a world-class management team including CEO John Passalacqua and President, and former Canadian Environment Minister, Peter Kent.
The North American LFP Battery Dilemma
North America is facing a major dilemma.
On one hand, demand for LFP batteries is rising fast, while on the other, the production of LFP-grade phosphoric acid, a key component of LFP batteries, is shrinking.
This lack of investment and production is severely affecting our competitiveness on a global stage with China quickly gobbling up market share–more than 90% of LFP batteries are manufactured in China.
But there is a solution.
The current process Chinese LFP battery manufacturers use to produce purified phosphoric acid is quite inefficient and harmful to the environment, making it an unsustainable option over the long run.
This is in contrast to First Phosphate’s process which, due to the quality of its phosphate deposits, is more environmentally friendly and produces greater quantities of LFP-grade purified phosphoric acid (85% feedstock recovery).
With the US Inflation Reduction Act requiring 40% of EV battery contents to be made in North America by 2023, and 80% by 2026, clean and domestic solutions are in high demand and First Phosphate is well positioned to deliver.
First Phosphate’s Hot Start to 2023
To do so, the Company is firing on all cylinders, demonstrating the quality of its phosphate concentrates and secondary recoveries, establishing partnerships with industry leaders and local organizations, and building key infrastructure for the production of pure phosphoric acid and cathode active materials.
Here is a complete breakdown of First Phosphate’s accomplishments in the first half of 2023…
- Closed the final tranche of an oversubscribed private placement that raised a total of $4.5 million. The Company ended up raising the ceiling of the offering, twice, from $2 million to $3.4 million to $4.5 million (in February) to accommodate for increased investor interest. Proceeds from this private placement were used for general working expenditures and exploration activities.
- Reported its highest phosphate assays to date at its Bégin-Lamarche Project located in Saguenay-Lac-Saint-Jean, Quebec. The survey uncovered assay results in the initial discovery area of 18.53% P2O5 (phosphate) and 11.73% TiO2 (titanium oxide), with numerous samples returning assays over 5% P2O5. First Phosphate then obtained the remaining phosphate assay results in February and determined multiple high-grade surface grab samples of up to 18.96% P2O5 and 6.81% TiO2. First Phosphate also analyzed 43 trace elements and determined that there were very low concentrations of potentially deleterious elements, which are typically harmful to the environment.
- Commenced trading on the Canadian Securities Exchange (CSE) and Frankfurt Stock Exchange (FSE) under the ticker symbols “PHOS” and “KD0”, respectively. The move to go public offers “global investors a means of gaining exposure to pure-play, clean phosphate development focused on the Lithium Iron Phosphate (LFP) battery on-shore in North America,” said Peter Kent, President of First Phosphate.
- Inked a key partner through the signing of a memorandum of understanding (MOU) with Prayon, the Belgian-based global leader in purified phosphoric acid (PPA) production and technology. The partnership will help accelerate First Phosphate’s operations by providing future offtake for its phosphate concentrate, access to PPA technology, and LFP cathode active material production.
- Initiated a 2023 winter drill program at Bégin-Lamarche to test the continuity of high-grade phosphate on the property. The drill program consisted of 20 drill holes for a total of 4,274 meters. Over the next four months, the Company obtained drill results that uncovered two main zones with multiple open pit-accessible phosphate-bearing layers. The Northern Zone consisted of four layers with a length of 375 meters and an average thickness of at least 60 meters. Its four layers produced an average grade of 6.2% P2O5, with two of the four layers showing grades in excess of 7.0% P2O5. As for the Southern Zone, it comprises at least two layers up to 1,500 meters long, with an average thickness of 100 meters. The average grade for the two layers is 4.7% P2O5. First Phosphate is now planning a 2023 summer drill program to reach a National Instrument 43-101 readiness in 2024.
- Initiated a preliminary economic assessment (PEA) at its Lac à l’Orignal Phosphate Project after it completed a successful National Instrument 43-101 study–the National Instrument 43-101 is a set of standards of disclosure for mineral projects that are required for companies listed on the CSE. The Company engaged P&E Mining Consultants to lead the PEA which is scheduled for completion in the third quarter of 2023.
- Signed a licensing agreement with Integrals Power Limited (IPL) allowing for the manufacturing of LFP cathode active materials at any of First Phosphate’s facilities in North America. IPL will also validate and homologate First Phosphate produced PPA and iron sulphate in its LFP cathode active material production process–essentially, homologation is a way to test and approve the quality of LFP cathode active material.
- Achieved a world-leading high-purity phosphate concentrate of 40.2% at a 91.4% recovery rate sourced from its Lac à l’Orignal property. The achievement demonstrates First Phosphate’s ability to produce large amounts of purified phosphoric acid for the production of LFP batteries. The test work was completed by SGS Canada, an independent laboratory in Quebec City.
- Completed an in-depth mineralogical study with Queen’s University which concluded First Phosphate’s Lac à l’Orignal property is likely an ESG-compliant source of North American phosphate for the LFP battery industry. This implies that Lac-à-l’Orignal could potentially be one of the first phosphate mines to be ESG-compliant since they generally are not.
- Established strategic partnerships with the Regional Conference of the Prefects of Saguenay-Lac-Saint-Jean (CRP) and the Regional Economic Impact Maximization Committee (CMAX). The collaboration agreement provides First Phosphate with major project status and access to the region’s entrepreneurial workforce, as well as local and regional private and government-related industrial resources. In return, the partnership will fuel positive economic impacts for construction companies, equipment manufacturers, and their suppliers in the Saguenay-Lac-Saint-Jean Region, thus creating a win-win situation for all.
- Closed a new oversubscribed private placement that raised gross proceeds of $2,339,151.90. The offering was led by the Company’s management, board of directors, and chief geologist who subscribed for gross proceeds of $456,380. The proceeds from this issuance will be used for Canadian exploration expenses related to its mineral exploration projects, primarily for drilling at the Bégin-Lamarche and Lac à l’Orignal properties, as well as general corporate purposes.
- Appointed Gary Siskos as the Company’s COO and CFO. Mr. Siskos has over 25 years of international experience as CFO and COO inside entrepreneurial and multinational public and private business environments and was involved in two of Canada’s Top 100 growth organizations. He specializes in strategy, capital raising, structured finance, and M&A.
- Added Isobel Sheldon, the renowned battery executive, and entrepreneur, to the First Phosphate advisory board. Ms. Sheldon is a 20-year veteran in the Lithium Ion battery industry, holding various senior strategy, technical, business, and executive roles with companies like Britishvolt, UK Battery Industrialization Centre, Cummins Electrified Power, and Johnson Matthey. She was awarded an Order of the British Empire from Her Majesty the Queen of England for long service to EV battery development and was ranked 37th in OutAtWork’s top 50 LGBT executives in the UK.
- Commissioned a solventless, environmentally friendly phosphate concentration pilot plant. The pilot plant optimizes First Phosphate’s metallurgical process for the production of a super high-grade phosphate concentrate approaching 41% P2O5. It produced over 900 kilograms of apatite concentrate which were sent to its partner, Prayon, for the production of battery-grade purified phosphoric acid.
- Completed its share purchase agreement to acquire 50% of the First Phosphate common shares owned by Glen Eagle Resources. The agreement involved the purchase of 2,700,000 common shares which are set to be released from escrow in 2023 and 2024. Glen Eagle will retain the other 2,700,000 common shares set for release from escrow in 2025 and 2026. Glen Eagle originally received common shares for the sale of the Lac à l’Orignal flagship property to First Phosphate.
What’s Next for First Phosphate?
First Phosphate has accomplished many feats in the first half of 2023, but this is only the beginning
To be an industry leader in the global LFP market requires consistent execution and long-term focus, and that is exactly what they plan to do.
In this next phase, the Company is looking to build on its projects and partnerships, drawing many steps closer to its goal of producing pure phosphoric acid and cathode active materials for the LFP battery industry.
As mentioned, this includes the completion of its Preliminary Economic Assessment (PEA) at Lac-à-l’Orignal, and its summer drill program at Bégin-Lamarche to reach a National Instrument 43-101 readiness in 2024.
But, it also includes…
- Prospecting and geological reconnaissance programs on its Bluesky properties at Alex, Brochet, Larouche, and Perron where strong phosphate indications have been found.
- Working with SGS Quebec to demonstrate pilot scale separation of apatite from ilmenite and magnetite to create three distinct and marketable recoveries.
- Working with its partner Prayon to launch pilot scale production of battery grade PPA based on phosphate concentrate originating from First Phosphate mineral properties.
- Investigating the creation of LFP raw material inputs such as iron sulphate and iron powder (from our secondary recoveries of ilmenite and magnetite) to meet client sample inquiries.
- Enhancing the output of secondary recoveries of ilmenite (titanium) and magnetite (iron) to boost the economic potential of our Lac-à-l’Orignal mineral resource.
- Continuing to advocate for the development of the Saguenay-Lac-St-Jean Region of Québec into the LFP Battery Valley of North America.
- Continuing to advocate for the inclusion of phosphate to the critical minerals lists of Quebec, Canada, and the United States.
As you can see, First Phosphate (Canada: PHOS)(Frankfurt: KD0) is determined to become a key player in the emerging LFP battery industry in North America and beyond.
Through an objective-focused strategy, the Company continues to execute its mission, thus delivering long-term value for shareholders.
North America is ripe with potential for LFP development and First Phosphate has the assets, partners, and expertise to make it happen.
If you’d like to learn more about First Phosphate and its strategy to be a leader in pure phosphoric acid and cathode active material production for the LFP battery industry, check out its investor presentation below.
|FIRST PHOSPHATE (Canada: PHOS)(Frankfurt: KD0)
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