Chinese Firm to Acquire 13 Percent of Canadian Lithium Company for $5 Million

A Chinese firm that specializes in industrial explosives is planning to acquire a more than 10 percent stake in a Canadian lithium company for $5 million.On April 17, China-based company Sichuan Yahua Industrial Group Co. Ltd. announced its plan to acquire 13.2 percent of Ultra Lithium Inc., a Vancouver-based lithium and gold exploration firm, through its wholly-owned subsidiary Yahua International Investment and Development Co. Ltd. The deal signed between the two companies will also see Yahua International acquiring a 60 percent stake in a wholly-owned subsidiary of Ultra Lithium, which has two lithium projects in Forgan Lake and Georgia Lake in Ontario. Due to the local geology, Yahua Group said the two projects offer high potential for the discovery of large spodumene deposits. Spodumene is an essential supply of lithium used in ceramics, cellphones, and car batteries, among several uses. The joint venture will see the building of a lithium concentrate mining and processing plant that produces 200,000 tons of lithium a year, and double in capacity over a minimum lifespan of 10 years, according to Yahua Group. The Chengdu-based company added that the deal will help secure its upstream resources in the lithium sector. The board of directors of the joint venture will have five members, three of whom will be nominated by Yahua International and two by Ultra Lithium. This isn’t the first time a Chinese company has had its eye on a Canadian mining firm. In February, Chinese state-owned enterprise Zijin Mining Group Co. Ltd. completed its acquisition of Toronto-based Neo Lithium Corp. Zijin Mining first announced its intention to purchase Neo Lithium last October, opening a 45-day period during which the federal government could conduct a review. However, no review took place. When news broke in January that the deal was approved by Neo Lithium’s shareholders on Dec. 10, 2021, and that the Ontario Superior Court of Justice granted approval of the transaction five days later, the Conservative Party called for a national security review of the purchase. “It’s concerning that the foreign takeover of Canadian lithium mining company Neo Lithium was not immediately subject to a national security review by the Liberal government,” said a press release issued by Conservative MPs Michelle Rempel Garner and Ed Fast on Jan. 13. “Canada is falling behind in developing its critical mineral industries, and allowing the foreign takeover of companies like Neo Lithium without due diligence could further weaken our strategic interest in developing a domestic supply of lithium and other critical minerals.” Prime Minister Justin Trudeau has said securing critical minerals is a key objective of his government. In a mandate letter last December, he instructed François-Philippe Champagne, minister of Innovation, Science and Industry, to work to attract investments in “minerals processing, cell manufacturing, and zero-emissions vehicle parts and assembly manufacturing” and “ensure the protection and development of our critical minerals.” Champagne, along with Natural Resources Minister Jonathan Wilkinson, was told to launch a Canadian Critical Minerals Strategy to make Canada a global leader in mining and the production of batteries. In a webinar last November, Jane Nakano, senior fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies in Washington, D.C., said clean energy technology has become the latest frontier for geoeconomic competition between China and the West. “Once upon a time, China was the world’s factory, sort of a supplier of these minerals and middles, but it’s no longer the case. China is starting to capture the higher end value of these clean energy supply chains or value chains,” Nakano said. She noted that the demand within China for the critical minerals needed for clean energy technologies has also been rising, which means “they’re consuming much more of what they produce as opposed to exporting.” This has put pressure on Western economies dependent on mineral imports to secure their critical minerals supply chains, she said. Equally important is that China recognizes that its critical mineral supplies can serve as geopolitical leverage, Nakano added. Noe Chartier contributed to this report. Follow Isaac Teo is an Epoch Times reporter based in Toronto.

Chinese Firm to Acquire 13 Percent of Canadian Lithium Company for $5 Million

A Chinese firm that specializes in industrial explosives is planning to acquire a more than 10 percent stake in a Canadian lithium company for $5 million.

On April 17, China-based company Sichuan Yahua Industrial Group Co. Ltd. announced its plan to acquire 13.2 percent of Ultra Lithium Inc., a Vancouver-based lithium and gold exploration firm, through its wholly-owned subsidiary Yahua International Investment and Development Co. Ltd.

The deal signed between the two companies will also see Yahua International acquiring a 60 percent stake in a wholly-owned subsidiary of Ultra Lithium, which has two lithium projects in Forgan Lake and Georgia Lake in Ontario.

Due to the local geology, Yahua Group said the two projects offer high potential for the discovery of large spodumene deposits. Spodumene is an essential supply of lithium used in ceramics, cellphones, and car batteries, among several uses.

The joint venture will see the building of a lithium concentrate mining and processing plant that produces 200,000 tons of lithium a year, and double in capacity over a minimum lifespan of 10 years, according to Yahua Group.

The Chengdu-based company added that the deal will help secure its upstream resources in the lithium sector. The board of directors of the joint venture will have five members, three of whom will be nominated by Yahua International and two by Ultra Lithium.

This isn’t the first time a Chinese company has had its eye on a Canadian mining firm. In February, Chinese state-owned enterprise Zijin Mining Group Co. Ltd. completed its acquisition of Toronto-based Neo Lithium Corp.

Zijin Mining first announced its intention to purchase Neo Lithium last October, opening a 45-day period during which the federal government could conduct a review. However, no review took place.

When news broke in January that the deal was approved by Neo Lithium’s shareholders on Dec. 10, 2021, and that the Ontario Superior Court of Justice granted approval of the transaction five days later, the Conservative Party called for a national security review of the purchase.

“It’s concerning that the foreign takeover of Canadian lithium mining company Neo Lithium was not immediately subject to a national security review by the Liberal government,” said a press release issued by Conservative MPs Michelle Rempel Garner and Ed Fast on Jan. 13.

“Canada is falling behind in developing its critical mineral industries, and allowing the foreign takeover of companies like Neo Lithium without due diligence could further weaken our strategic interest in developing a domestic supply of lithium and other critical minerals.”

Prime Minister Justin Trudeau has said securing critical minerals is a key objective of his government.

In a mandate letter last December, he instructed François-Philippe Champagne, minister of Innovation, Science and Industry, to work to attract investments in “minerals processing, cell manufacturing, and zero-emissions vehicle parts and assembly manufacturing” and “ensure the protection and development of our critical minerals.”

Champagne, along with Natural Resources Minister Jonathan Wilkinson, was told to launch a Canadian Critical Minerals Strategy to make Canada a global leader in mining and the production of batteries.

In a webinar last November, Jane Nakano, senior fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies in Washington, D.C., said clean energy technology has become the latest frontier for geoeconomic competition between China and the West.

“Once upon a time, China was the world’s factory, sort of a supplier of these minerals and middles, but it’s no longer the case. China is starting to capture the higher end value of these clean energy supply chains or value chains,” Nakano said.

She noted that the demand within China for the critical minerals needed for clean energy technologies has also been rising, which means “they’re consuming much more of what they produce as opposed to exporting.” This has put pressure on Western economies dependent on mineral imports to secure their critical minerals supply chains, she said.

Equally important is that China recognizes that its critical mineral supplies can serve as geopolitical leverage, Nakano added.

Noe Chartier contributed to this report.


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Isaac Teo is an Epoch Times reporter based in Toronto.