Canada Backs Frontier Lithium’s Thunder Bay Processing Facility
Frontier Lithium has secured commitments from both the federal and Ontario governments to support the development of a lithium conversion facility in Thunder Bay. The project aligns with Canada’s goal of establishing a complete critical minerals supply chain.
The facility will process lithium from Frontier’s PAK project, producing about 20,000 tonnes of lithium salts annually. These materials will contribute to battery production for approximately 500,000 electric vehicles per year. Additionally, the facility is designed to process lithium from other domestic and international sources.
Government contributions, which remain subject to standard conditions, are expected to cover a substantial portion of the project’s capital expenditures. Final agreements will be signed between Frontier Lithium and relevant agencies once terms are finalized.
The initiative supports Canada’s Critical Minerals Strategy and Ontario’s efforts to build domestic supply chains. Federal Natural Resources Minister Jonathan Wilkinson described critical minerals as a major economic opportunity, highlighting Canada’s investment through the Strategic Innovation Fund to position the country as a global leader in critical mineral supply and technology. Ontario Economic Development Minister Vic Fedeli emphasized the project’s role in strengthening the province’s workforce and refining minerals domestically.
The Thunder Bay facility is set to become Canada’s first lithium conversion plant, reinforcing North America’s critical minerals network and reducing reliance on foreign processing. It is a key part of the PAK lithium project, a joint venture between Frontier Lithium (92.5%) and Mitsubishi Corporation (7.5%), which aims to develop one of North America's highest-grade lithium deposits.
A 2023 prefeasibility study estimated the PAK project’s post-tax net present value at $1.74 billion, with an internal rate of return of 24.1% over 24 years. The development supports Canada’s efforts to secure domestic battery material supply chains as global demand for critical minerals is projected to double by 2040.
