Finnish export credit agency Finnvera has issued a nonbinding letter of interest regarding potential financing for equipment and services to be supplied to Avalon Advanced Materials’ proposed Lake Superior lithium processing facility in Thunder Bay, Ontario, Canada. The letter follows an application by Metso, a Finland-based provider of sustainable technologies for minerals processing, relating to an anticipated commercial contract valued at approximately €100 million. Finnvera confirmed sufficient Finnish interest to consider supporting the contract through an export credit financing structure. Subject to due diligence and credit approval, Finnvera may provide a buyer credit guarantee for an eligible arranging commercial bank, with its subsidiary Finnish Export Credit potentially acting as lender.
Avalon President and CEO Scott Monteith called the letter an important initial milestone in developing a comprehensive financing strategy for the facility, noting that Metso’s global recognition and potential Finnish export credit support provide a credible pathway to finance a significant equipment package while advancing a secure North American lithium supply chain. Under Finnvera’s framework, an export credit may finance up to 85% of eligible Finnish goods and services, along with certain local costs and capitalized interest. Avalon CFO Lorin Crenshaw emphasized that this development enhances the company’s ability to pursue an integrated financing structure combining export credit support with Canadian and US government programs, commercial project debt, strategic investment, and offtake-related financing. The company aims to minimize blended cost of capital by maximizing institutional and project-level financing while reducing reliance on parent-level equity. Avalon will work with Metso and Finnvera to define the eligible equipment package and financing process. A 2024 preliminary economic assessment outlines the use of Metso proprietary technologies including calcination, pressure leaching, conversion, purification through ion exchange, and crystallization to produce high-quality lithium hydroxide monohydrate. The plant is expected to produce approximately 30,000 tonnes per year of battery-grade LHM.
