First Phosphate Targets Quebec LFP Supply Chain With 2027 Feasibility Study

Key Points

• First Phosphate is targeting Quebec’s LFP battery supply chain through its Bégin-Lamarche igneous phosphate project, aiming to produce phosphate concentrate and purified phosphoric acid while relying on partners for downstream cathode and battery manufacturing.
• The company cites preliminary projections of a $2.1 billion net present value, 37% internal rate of return and 23-year mine life, though these estimates remain subject to a feasibility study and permitting.
• First Phosphate expects to publish the feasibility study in Q1 2027, with permitting targeted for 2028. It reports government contributions, prospective international financing covering roughly 80% of estimated $500 million construction costs, and offtake agreements for 200,000 metric tons of phosphate concentrate and 60,000 metric tons of phosphoric acid.

First Phosphate NASDAQ: PHOS CEO John Passalacqua outlined the company’s plans to develop high-purity igneous phosphate production in Quebec for the lithium iron phosphate, or LFP, battery supply chain, citing project financing discussions, offtake agreements and an expected feasibility-study timeline.

During a company presentation, Passalacqua said First Phosphate is focused on phosphate used in LFP battery materials rather than the sedimentary phosphate typically used in fertilizer production. He characterized LFP as the leading battery chemistry and said its use extends beyond electric vehicles to include grid-scale energy storage, data centers, robotics, marine applications, agriculture, defense, drones and telecommunications.

“What really distinguishes First Phosphate is we are a pure play for exposure into lithium iron phosphate, LFP, battery chemistry,” Passalacqua said.

Focus on Igneous Phosphate

Passalacqua said the LFP cathode contains phosphate, iron and lithium, with phosphate representing 60% of the cathode by composition. He argued that high-purity phosphoric acid will be needed to support expanded LFP production outside Asia, where he said much of the existing supply chain is concentrated.

According to Passalacqua, sedimentary phosphate accounts for about 95% of global phosphate deposits and is generally used for fertilizer. In contrast, he described igneous phosphate as a cleaner material with fewer heavy metals and said it can be converted more directly into purified phosphoric acid for battery applications.

The company’s Bégin-Lamarche project in Quebec is based on igneous anorthosite rock, Passalacqua said. He said the project’s processing approach separates magnetite, ilmenite and silicates, leaving a phosphate concentrate containing 40.4% P2O5. He added that the company estimates 91.1% of the material can be converted into purified phosphoric acid for LFP batteries.

Passalacqua said a recent drilling program increased the project’s indicated resources by 378% and confirmed continuity and consistency across the deposit. The planned open-pit operation is approximately 2.7 kilometers long, 500 meters wide and extends about 400 meters deep, he said. The company also has 89.5 million metric tons of inferred resources that are not included in the feasibility study, according to the presentation.

• Estimated net present value: $2.1 billion
• Estimated internal rate of return: 37%
• Estimated payback period: 2.9 years
• Estimated strip ratio: 1.5-to-1
• Estimated mine life: 23 years

These figures represent company projections and are subject to the completion of the feasibility study and permitting process.

Infrastructure and Supply-Chain Plans

The Bégin-Lamarche project is located in Quebec’s Saguenay–Lac-Saint-Jean region, about 70 kilometers by road from the deep-sea Port of Saguenay, Passalacqua said. He said the location provides access to industrial workers, equipment suppliers, rail service and shipping routes.

First Phosphate has produced LFP battery materials from its phosphate rock through a supply chain that includes phosphate concentrate, purified phosphoric acid, iron phosphate precursor and LFP cathode active material, according to Passalacqua. He said the company and its commercial partners produced LFP batteries using North American critical minerals in both the cathode and anode.

The company intends to focus on mining phosphate concentrate and producing phosphoric acid, while downstream partners would manufacture iron phosphate precursor, cathode active material and batteries, he said.

Funding, Offtake and Timeline

Passalacqua said First Phosphate has received CAD 21.5 million in non-dilutive Canadian government contributions to support feasibility work, roadwork and electrical infrastructure. He also said the project has been placed in Quebec’s fast-track permitting pilot program and was designated as a G7 strategic project.

He said Denmark has indicated CAD 190 million in financing support, Switzerland has indicated CAD 212 million, and Italian entities are supporting development of a phosphoric acid plant. Passalacqua said the Danish and Swiss financing discussions together represent roughly 80% of the estimated $500 million required to build the mine.

The company has also signed what Passalacqua described as definitive, bankable offtake agreements with a Western ally for 200,000 metric tons of phosphate concentrate and 60,000 metric tons of phosphoric acid.

First Phosphate expects to release its feasibility study in the first quarter of 2027, complete environmental work and Quebec consultations in the third quarter of 2027, and submit permit applications in the first quarter of 2028. A final investment decision is targeted for the second quarter of 2028.

Passalacqua said the company had approximately CAD 22 million to CAD 23 million in cash and access to another approximately CAD 20 million in Canadian government funding. He said this capital is expected to fund the company through the anticipated final investment decision, and that it has no immediate plans for a capital raise unless an opportunity is strategic or accretive.

He added that First Phosphate has no debt, while its board and management own approximately 20% of the company and have contributed more than CAD 4 million of their own funds.

About First Phosphate (NASDAQ:PHOS)

First Phosphate Corp. is a Canadian mineral development company focused on advancing phosphate resources in Quebec, Canada. The company is working to develop an integrated supply chain for lithium iron phosphate (LFP) battery materials, which are used in certain lithium-ion batteries for electric vehicles, energy storage systems and other applications.

First Phosphate's activities include the exploration and development of phosphate properties in the Saguenay–Lac-Saint-Jean region of Quebec, including its Bégin-Lamarche project.

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