The Government of Canada has ordered three Chinese companies to divest from three Canadian critical mineral companies: Power Metals, Lithium Chile, and Ultra Lithium. (Earlier post.) Ultra Lithium has now issued a statement noting that the company has been advised that Zangge Mining Investment (Chengdu) Co. Ltd. (Zangge) received the order from Government of Canada to divest. Ultra Lithium and Zangge have also mutually agreed to terminate the definitive agreement with respect to the Laguna Verde property announced in June 2022.

Ultra Lithium said that its Board of Directors and management “are very surprised” at Canada’s policy against Chinese investment in Canada’s lithium projects and believe that the announcement has been detrimental to the company’s many Canadian shareholders. The company is assessing its legal and other options to preserve value for its shareholders.

Ultra Lithium said it is in full support of Canada’s push toward clean energy and has been committed to lithium and green energy since 2009. The company added that as a junior exploration company, it and many of its peers will require significant capital to bring their projects to production and build Canada’s critical minerals supply chain.

Ultra Lithium encouraged the federal government to follow through on its commitment to Canadian businesses to identify and find alternative sources of capital and to retain Canada’s status as a stable and top-tier mining destination.

Ultra Lithium is proceeding with planned work programs at its properties in Northern Ontario and Argentina.

Power Metals also expressed surprise at “Canada’s stance towards Chinese investment into Canada’s critical minerals industry”. However, said Jonathan More, Chairman & CEO:

It clearly shows that they see the opportunity and assets of Power Metals as too valuable for such foreign investment. Power Metals has made a substantial discovery of cesium, lithium and tantalum and this political gamesmanship demonstrates the extreme value of Power Metals assets. Sinomine will respond to the Canadian government shortly as they look at the appeal process.

Power Metals said that drilling and exploration activities will continue as usual.