Elevra Lithium's Pre-Feasibility Study for the North American Lithium (NAL) brownfield expansion in Québec outlines a staged growth plan nearly doubling spodumene concentrate production to 373 ktpa by 2029, reducing unit costs and delivering a post-tax NPV of C$3.2 billion.
- Three-stage expansion increases plant throughput from 4,500 to 6,500 tpd
- Annual spodumene concentrate production rises to 373 ktpa post-expansion
- Life-of-mine C1 cost reduced to C$851/t concentrate after expansion
- Total initial CAPEX of C$366 million fully funded by strategic financing
- Post-tax NPV (8%) of C$3.2 billion and IRR of 49.9% with 34-month payback
Staged Brownfield Expansion Targets Near-Doubling Output
Elevra Lithium Limited (ASX:ELV) has released a comprehensive Pre-Feasibility Study (PFS) for its North American Lithium (NAL) operation in Québec, Canada, confirming a high-value, three-stage brownfield expansion. The plan aims to increase the processing plant throughput from its current permitted 4,500 tonnes per day (tpd) to 6,500 tpd by mid-2029, nearly doubling annual spodumene concentrate production to 373,000 tonnes per annum (ktpa) post ramp-up.
The staged approach begins with a 15-20% production increase within the existing milling permit by mid-2027, followed by a milling capacity expansion to 6,500 tpd in mid-2028 supported by a temporary mobile crushing circuit, and culminates in a permanent crushing solution with additional ore sorting capacity by mid-2029. This phased rollout is designed to mitigate execution risk and optimise capital deployment.
Cost Efficiencies and Financial Metrics Strengthen Expansion Case
Life-of-mine (LOM) unit operating costs (C1) are projected to fall from C$876 per tonne concentrate to C$851/t post-expansion, with all-in sustaining costs (AISC) reducing to C$918/t. The initial capital expenditure (CAPEX) is estimated at C$366 million (AACE Class 4 estimate with ±40% accuracy), fully funded through Elevra's Strategic Financing Package announced in May 2026.
Financially, the NAL Expansion delivers a post-tax net present value (NPV) at 8% discount of C$3.2 billion and an internal rate of return (IRR) of 49.9%, with a payback period of 34 months. The incremental post-tax NPV of the expansion alone is C$943 million, reflecting both operational improvements and lithium price assumptions based on Benchmark Mineral Intelligence forecasts.
Ore Reserves and Mine Life Underpin Expansion
The expansion is underpinned by existing Ore Reserves of 47.2 million tonnes at 1.12% lithium oxide (Li2O), comprising 0.2 Mt Proven and 47.0 Mt Probable Mineral Reserves, supporting a revised 20-year life of mine. The PFS excludes inferred resources, relying solely on measured and indicated categories to underpin the production target.
Mining methods remain conventional open-pit drill-blast-load-haul with careful consideration of historical underground workings. The mine plan includes detailed pit phasing, dilution and loss models, and haulage scheduling, achieving steady-state throughput of 6,500 tpd by FY2029.
Metallurgical Improvements and Infrastructure Upgrades
Metallurgical recoveries are forecast to improve to 71.2% spodumene recovery at a concentrate grade of 5.4% Li2O, supported by extensive testwork and operational data. Key process improvements include enhanced flotation feed sizing, upgraded magnetic separation circuits (LIMS and WHIMS), and improved flotation conditioning and cleaner tails handling.
Infrastructure enhancements include new crushing and ore sorting circuits, expanded grinding and flotation capacity, concentrate dewatering filters, and additional tailings storage facilities (TSF-2 and TSF-3), alongside waste rock stockpile expansions and water management infrastructure. Environmental permitting is staged, with ongoing efforts to secure approvals for capacity increases, pit expansion affecting Lortie Lake, and associated habitat compensation projects.
Market Outlook and Contractual Foundations
The PFS incorporates a lithium price scenario reflecting a volatile but structurally tight market, with spodumene concentrate prices forecast to average US$1,664/t over the near term and long-term prices reaching US$2,430/t. Global supply growth is expected to remain modest relative to robust demand, particularly from electric vehicles and energy storage systems.
Elevra’s existing offtake agreements with Tesla, LG Chem, and Mitsubishi provide a stable sales foundation. The company has also recently secured a binding seven-year supply deal with Mangrove Lithium, anchoring spodumene concentrate supply for a Canadian lithium conversion facility.
Environmental and Social Considerations in Expansion
Environmental studies confirm that the staged expansion will comply with provincial and federal regulations. The expansion’s impact on Lortie Lake triggers a provincial environmental assessment and public hearings. Elevra is engaging with First Nations and local communities, maintaining active monitoring committees and good neighbour forums to address concerns such as noise and habitat impacts.
Tailings management plans include progressive raises of existing TSF-1 and construction of new TSF-2 and TSF-3 facilities with robust geotechnical designs and water management systems. A dyke construction at Lortie Lake is planned to enable mining beneath the waterbody while preserving fish habitat and maintaining water levels.
Next Steps and Project Risks
Elevra plans to proceed directly to detailed engineering for Stages 1 and 2, with procurement and early works to follow. A Definitive Feasibility Study (DFS) phase is anticipated to refine cost estimates and further de-risk the project.
Key project risks include environmental impacts from temporary crushing circuits, permitting delays especially for pit expansion and lake drainage, community relations challenges, equipment sourcing, and capital escalation. Mitigation measures are in place, and ongoing metallurgical testwork aims to optimise recovery further.
The PFS positions the NAL Expansion as a technically feasible and economically compelling growth project, leveraging existing assets and infrastructure with significant operating leverage amid a supportive lithium market.
Bottom Line?
Elevra’s NAL Expansion PFS lays a solid foundation for near-term production growth and cost reduction, but execution risks and permitting hurdles remain critical to watch.
Questions in the middle?
- How will ongoing metallurgical testwork refine spodumene recovery assumptions and impact project economics?
- What are the timelines and potential challenges for securing environmental permits, especially for the Lortie Lake pit expansion?
- How might lithium price volatility affect the financial robustness of the expansion over its 20-year life?