Thank you very much.
Arianne Phosphate is a Chicoutimi‑based mining company that is developing a phosphate production project in Saguenay—Lac‑Saint‑Jean. Our company owns the Lac à Paul phosphate deposit, which is a fully permitted, construction-ready project located 200 kilometres north of the city of Saguenay. This asset is one of the world's largest undeveloped deposits, capable of producing environmentally friendly phosphate concentrate. Because of its high purity and low contaminant content, Arianne phosphate can be used to produce fertilizers, and has specialized applications including in food, animal feed, and the production of lithium-iron-phosphate batteries.
We plan to build an open-pit mine, an ore processing plant, and a deep-water port, in addition to upgrading 240 kilometres of logging road for the annual shipment of our three million tons of phosphate concentrate. At full production, the company will require approximately 375 employees.
Phosphorus is a key element in agriculture, as it cannot be substituted, making it indispensable to crop growing. It benefits root development and provides increased resistance to drought. Recent disruptions in the global supply chain, resulting from export quotas imposed by China and Russia, have been amplified by the situation in Ukraine. As a result, selling prices have risen considerably. Most importing countries had to revise their supply strategy, highlighting the weakness of the chain.
Canada has not been a phosphate-producing country since 2013, following the closure of the Agrium mine, now called Nutrien, in Kapuskasing. We are therefore 100% reliant on imports, mainly from the United States, which itself is a net importing country. As a result, the performance of the economy in the Prairies depends on our ability to source a product overseas—a product that we could in fact be exporting.
Arianne Phosphate's potential customers are located all over the world. However, the geographic location of our company and our access to the St. Lawrence Seaway give us a competitive advantage in serving markets in western Europe, the east coast and gulf regions of the United States, as well as Canada. These markets are particularly attractive, given that they are import markets for phosphate products that are showing steady growth in their use in traditional fertilizer applications. However, demand projections for technological applications such as battery manufacturing exceed current production capacity by far.
In that sense, the committee's current study is very important for the Canadian phosphate industry and for Arianne. It's an opportunity for Canada to set itself apart with a product of the future that meets two global needs: the use of fertilizers to improve food productivity, and the development of a lithium-iron-phosphate battery manufacturing industry as part of the global energy transition.
Although phosphorus is an abundant element on Earth, its geographical distribution makes it highly vulnerable in terms of security of supply, with most of the world's reserves concentrated in North Africa and China. It should also be noted that, in terms of quality, the concentrates produced in these countries are far inferior to those found in Canada. Our phosphate is igneous, not sedimentary, which means that the concentrate is much more pure and, in practice, free of heavy metals and radioactive elements. This is very important for the fertilizer industry, but even more so for battery manufacturing. In fact, only a limited portion of the world's phosphate reserves can be used to produce a phosphoric acid that meets the technical specifications of battery manufacturers.
Currently, virtually all the world's LFP cathode capacity is based in China. The phosphate used to produce those cathodes is also sourced domestically, as China is self-sufficient in phosphate. The implication of this is that, if LFP cathodes continue to be produced predominantly in China over the long term, the raw materials that are used in their production will continue to be sourced domestically as well. To be successful, western carmakers will need to reduce their dependence on materials from China and locally source raw materials and inputs, particularly PPA, purified phosphoric acid.
Canada has a role to play in solidifying its strategic advantage in phosphorus. It is disappointing to see that this element of the future is not currently part of the Canadian critical minerals strategy.
The government is also relying heavily on mining exploration, but few mining projects are underway in the country. There are various reasons for this, including the lengthy time periods required and strict regulations, not to mention the lack of support for mining infrastructure development.
Thank you for listening.