Canada-based miner Avalon Advanced Materials has entered a memorandum of understanding (MoU) with Finnish machinery supplier Metso for the development of a lithium processing facility in Ontario, Canada.

With the non-binding MoU, the companies will immediately seek to establish terms for the facility’s development.

The new plant will process lithium mineral concentrates into lithium hydroxide, which plays an essential role within the North American electric vehicle (EV) battery value chain.

Avalon plans to deploy Metso's technology to construct and operationalise a full-service lithium processing facility at its recently acquired industrial site in Thunder Bay, Ontario.

Once completed, the planned facility will help Avalon become the first vertically integrated lithium producer in the region.

It will also facilitate a stable, long-term supply of the element for the EV battery manufacturing base in Canada.

Avalon Advanced Materials president Zeeshan Syed said: “Metso's platform and technological solutions perfectly complement Avalon's vision to complete an integrated lithium value chain in Ontario, predicated on innovative process solutions.

“We view Metso as an integral part of this rapidly growing sector, and a foundational partner in developing internationally best-in-class processing capabilities that are environmentally sustainable, allowing Avalon to meet the soaring demand for battery-grade lithium.”

Up to 500 jobs are expected to be created by the proposed facility and upstream lithium project in the Kenora region.

Metso hydrometallurgy head Mikko Rantaharju said: “We are also extremely excited to be partnering with the first Ontario conversion facility with Metso's technology. The innovation advantages of the alkaline process allow for the elimination of the use of potentially harmful chemicals such as sulphuric acid and comparatively reduces overall solid waste and emissions, making it environmentally friendlier and overall, safer for workers and local surrounding communities.”

The MoU stipulates that both parties must pursue a definitive agreement to establish the lithium hydroxide facility in Thunder Bay.

The MoU also allows for Metso to conduct testing and engineering work across Avalon’s portfolio of critical mineral projects, including its flagship deposit at Separation Rapids near Kenora in the province.

The two parties plan to reach a definitive agreement on or before this September.