Company News

UPDATE 1-Nemaska Lithium eyes fresh steps to raise capital for Quebec project -executive

(Adds details of project, background and further comments from Cutler)

SANTIAGO, June 12 (Reuters) - Nemaska Lithium Inc may issue new shares, take on new debt or sell assets as it hunts for fresh capital to build a lithium project in Quebec that faces cost overruns of more than $300 million, head of investor relations Wanda Cutler said on Wednesday.

“Everything from M&A to more debt to equity is on the table,” Cutler told the Fastmarkets Lithium Supply and Markets Conference in Santiago. “Over the next few months, we’ll be making those decisions.”

Nemaska is developing the Whabouchi hard rock lithium project in northern Quebec, one of North America’s largest deposits of spodumene. A related processing plant is under construction near Montreal.

The company this year said it has faced cost overruns of more than $300 million as it works to build those facilities, part of a plan to supply the white metal for use in electric vehicle batteries.

Cutler said much of the cost overruns were due to “indirect” items that were not foreseen. For instance, Nemaska ended up having to build lodging at the mine for workers. The company had expected to lease the facility from a third party.

The chemical processing facility also has faced several design challenges, she said.

“In hindsight, perhaps on the chemical plant, the level of detailed engineering should have been a bit more advanced before we started construction,” Cutler said.

The news comes after a prolific year of fundraising last year for Nemaska, when the company pulled in more than $1 billion in part from stock offerings.

Reporting by Ernest Scheyder Editing by Sonya Hepinstall and David Gregorio