Avalon Rare Metals Inc. (TSX:AVL)
(NYSE MKT:AVL) ("Avalon" or the "Company") is pleased to provide an
update on its $750,000 pilot plant program on the Company's
Separation Rapids Lithium Project ("Separation Rapids Project" or
"the Project") located near Kenora, Ontario, first announced in its
news release of August 17, 2015.
The 30 tonne bulk sample of crushed ore that was shipped this
summer has arrived at its destination in Germany and process work
is now underway. The sample will be processed using the Company's
proven flow sheet to produce a high purity lithium mineral
(petalite) concentrate for the following purposes:
1) to deliver further product samples
to potential customers in the glass-ceramics industry who have
already tested and approved smaller samples;
2) to provide initial test samples to
a number of new potential customers; and
3) to generate concentrate for
additional process development work with the objective of producing
high purity lithium chemical products for the lithium ion battery
manufacturing business.
The pilot plant program will be completed, and concentrate
available for distribution, in Q1 2016.
Lithium chemicals process optimization work continues at the
laboratories of the Saskatchewan Research Council ("SRC") in
Saskatoon, Saskatchewan. Laboratory test work performed earlier
this year at SRC provided encouraging results with a battery-grade
lithium carbonate (>99.5% pure) being readily produced. Progress
is being made toward the production of an enhanced grade product
with a target purity of 99.9%. The potential for production of high
grade lithium hydroxide was also demonstrated previously and
optimization of this flowsheet is currently in progress. These
programs are being conducted under the direction of David Marsh,
Senior Vice-President, Metallurgy and Technology Development.
Rehabilitation work on the access road to the site initiated in
September has now been completed. This road will provide ready
access to the deposit for large scale bulk sampling in 2016.
Several hundred tonnes of petalite concentrate is expected to be
produced from this bulk sample and will be used for full-scale
production trials in the glass-ceramics industry and for piloting
the lithium chemical production processes.
Update on Lithium Markets
Growing demand for rechargeable batteries in electric vehicles
and home energy storage is expected to result in continued growth
in consumption of lithium. Critical materials consulting firm
Stormcrow Capital estimates that demand could reach 410,000 tonnes
of lithium carbonate equivalent per year in 2025, compared to
200,000 tonnes in 2015. This translates into a compounded annual
growth rate of 7.8%. In their May 2015 Industry Report, Stormcrow
further predicts that a supply deficit will emerge in the market as
existing producers struggle to meet the rapidly growing demand.
This sentiment was echoed at The Battery Show in Novi, Michigan
September 15-17, attended by Vice-President, Sales and Marketing,
Pierre Neatby, where some 5,000 industry participants gathered to
discuss the current and future state of rechargeable batteries. The
consensus was that lithium ion battery demand would grow
significantly over the next decade in electric and hybrid vehicles
and energy storage applications.
On September 24, Avalon was one of the sponsors of the Benchmark
Mineral Intelligence ("Benchmark") Lithium Ion Battery supply chain
conference in Toronto. The conference provided excellent
perspective on the rechargeable battery market and its main raw
material needs: lithium, graphite and cobalt. Guy Bourassa,
President and CEO of Nemaska Lithium Inc., one of the most advanced
lithium chemicals projects in Canada, noted that "the market will
need some 100,000 tonnes of new lithium chemicals supply to come
into the market to over the next 5 years to meet the growing
demand." Industry panel participants, which included Avalon
President & CEO Don Bubar, agreed that this rate of demand
growth will require multiple new producers in order to keep the
market in balance.
The chart below presented by Benchmark shows the increasing
trend of battery grade lithium carbonate prices (US$/tonne) over
the past 10 years reflecting the growing supply demand
imbalance:
(To view the chart, please visit:
https://orders.newsfilecorp.com/files/3386/17578_chart-enlarged.jpg)
Don Bubar, President and CEO of Avalon Rare Metals Inc.
commented, "We are excited about all the new interest in the
lithium sector. The rapid advance in lithium ion battery technology
is creating new business opportunities for the Separation Rapids
Project that were unimaginable in 1996 when Avalon first began work
on the Project. Avalon is now uniquely positioned to be a long term
supplier of both high purity lithium minerals to the glass ceramics
market and lithium chemicals to the rapidly growing lithium ion
rechargeable battery market."
The technical information included in this news release has been
reviewed and approved by the Company's Senior Vice President
Metallurgy and Technology Development, Mr. David Marsh, FAusIMM
(CP), who is a Qualified Person under NI 43-101.
For questions or feedback, please email the Company at
ir@avalonraremetals.com, or phone Don Bubar, President & CEO,
at 416-364-4938.
Cautionary Statement
This news release contains "forward-looking statements" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and applicable Canadian securities legislation.
Forward-looking statements include, but are not limited to,
statements regarding the commencement and completion of its work
programs, that that the sample will be processed to produce a high
purity lithium mineral, that the pilot plant program will be
completed, and concentrate available for distribution, in Q1 2016,
that the road will provide ready access to the deposit for large
scale bulk sampling in 2016, that several hundred tonnes of
petalite concentrate is expected to be produced from this bulk
sample and will be used for full-scale production trials in the
glass-ceramics industry and for piloting the lithium chemical
production processes, that growing demand for rechargeable
batteries in electric vehicles and home energy storage is expected
to result in continued growth in consumption of lithium and that
Avalon is now uniquely positioned to be a long term supplier of
both high purity lithium minerals to the glass ceramics market and
lithium chemicals to the rapidly growing lithium ion rechargeable
battery market. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as
"potential", "scheduled", "anticipates", "continues", "expects" or
"does not expect", "is expected", "scheduled", "targeted",
"planned", or "believes", or variations of such words and phrases
or state that certain actions, events or results "may", "could",
"would", "might" or "will be" or "will not be" taken, reached or
result, "will occur" or "be achieved". Forward-looking statements
are subject to known and unknown risks, uncertainties and other
factors that may cause the actual results, level of activity,
performance or achievements of Avalon to be materially different
from those expressed or implied by such forward-looking statements.
Forward-looking statements are based on assumptions management
believes to be reasonable at the time such statements are made.
Although Avalon has attempted to identify important factors that
could cause actual results to differ materially from those
contained in forward-looking statements, there may be other factors
that cause results not to be as anticipated, estimated or intended.
Factors that may cause actual results to differ materially from
expected results described in forward-looking statements include,
but are not limited to market conditions, the possibility of cost
overruns or unanticipated costs and expenses, and unanticipated
results from the work programs, as well as those risk factors set
out in the Company's current Annual Information Form, Management's
Discussion and Analysis and other disclosure documents available
under the Company's profile at www.SEDAR.com. There can be no
assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Such forward-looking statements
have been provided for the purpose of assisting investors in
understanding the Company's plans and objectives and may not be
appropriate for other purposes. Accordingly, readers should not
place undue reliance on forward-looking statements. Avalon does not
undertake to update any forward-looking statements that are
contained herein, except in accordance with applicable securities
laws.
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