Mining giant Rio Tinto issued dozens of layoff notices to workers at the Nemaska Lithium plant site in Quebec, halting heavy machinery and pausing construction on an electric vehicle battery chain that was nearly 80 percent complete, CTV News reported.
The workforce reduction marks the latest setback for the town of Bécancour, located in a region known as Battery Valley, where officials previously expected to anchor a massive electric vehicle manufacturing boom.
“Decisions on further investment and project timing at Bécancour will depend on the outcome of the evaluation, project economics, market conditions, and customer needs,” Rio Tinto said in a statement.
The global metal and mining giant stated it remains confident in the long-term outlook for lithium processing in Quebec and Canada. That confidence persists despite a decline in lithium prices as global demand for battery materials and electric vehicles has slowed.
Bécancour sits along the shores of the St. Lawrence River halfway between Montreal and Quebec City. As EV battery facilities began setting up in the town’s industrial park in 202, municipal leaders estimated the project would deliver 1,500 direct jobs and 5,000 indirect jobs across the restaurant and service sectors.
Population growth ticked upward with the arrival of construction workers. To accommodate newcomers, the city planned to expand schools, build housing, and purchase new ladder trucks for the local fire station.
When sales of electric vehicles slowed down, developers paused some projects and scrapped others entirely. In March, Nemaska announced it would scale down the pace of building its processing plant.
The provincial government owns 46.1 percent of Nemaska, making the project vital to Quebec’s broader strategy to establish an electric vehicle battery manufacturing chain. However, Quebec’s new government stated it would not spend a penny more on the project for the time being.
“Our sincere hope is that this is going to work, because I don’t want to be the guy to write off the $1.1 billion we invested,” Stéphane Paquet, minister of economic development, innovation and energy, told CTV News.
Despite the financial freeze and construction pause, local leaders maintain that electrification remains the region’s future. Mario Lyonnais, prefect of the region, described the current challenges as temporary hurdles in the path toward widespread adoption.
“The battery file is here to stay,” Lyonnais told CTV News. “I am confident that the Nemaska plant will open. When it does, we will be ready and we will continue to prepare.”
Lyonnais said that the initial battery boom moved at a breakneck speed, making it difficult for local municipalities to keep pace with scaling up services. He suggested the current slowdown may give the area more time to prepare for the plant’s eventual grand opening.
The plant is situated in the town of Bécancour, Quebec, along the shores of the St. Lawrence River halfway between Montreal and Quebec City.
The Quebec government owns a 46.1 percent stake in the Nemaska project.
Construction on the electric vehicle battery chain at the site was nearly 80 percent complete when majority owner Rio Tinto issued layoff notices and halted heavy machinery.