Mitsubishi Corporation, a prominent trading company in Japan, has agreed to invest $25 million in Frontier Lithium (TSXV: FL) and its PAK lithium project mine and planned conversion facility in Ontario, Canada. The companies have entered into a definitive agreement to establish a joint venture (JV) partnership, with Mitsubishi acquiring an initial 7.5% interest in the project.
Upon the completion of the definitive feasibility study (DFS), Mitsubishi will have the option to increase its stake in the JV to 25% by purchasing additional shares at a price determined by the net value of the project as outlined in the DFS. Both Mitsubishi and Frontier will collaborate closely to secure project financing for the development capital costs.
The JV structure includes equity funding for the planned mine and mill, while ensuring that at least 75% of the future off-take remains with Frontier. Frontier Lithium’s President and CEO, Trevor Walker, emphasized the long-term nature of the partnership, supporting mining development at PAK and potential expansions in chemical processing downstream.
Walker indicated that the collaboration with Mitsubishi marks a significant step towards Frontier Lithium’s aim of becoming a key supplier to the North American electric vehicle battery materials supply chain. He highlighted Mitsubishi’s investment as a vote of confidence in Ontario’s regulatory framework, the quality and scale of Frontier’s asset, and the company’s operational expertise.
Kota Ikenishi, the General Manager of Mitsubishi’s battery minerals office, recognized PAK as an exceptional lithium project with strategic importance in securing a stable lithium supply for North American markets. He expressed enthusiasm for establishing a long-term relationship with Frontier, leveraging complementary skills and capabilities to bring PAK into production.
The Mitsubishi-Frontier partnership aligns with a recent memorandum of cooperation between the governments of Canada and Japan, aiming to enhance collaboration towards establishing sustainable and reliable global battery supply chains. This initiative includes promoting integrated investments in the upstream, midstream, and downstream sectors, encompassing the mining and processing of lithium and other critical minerals.
