Lithium’s strong recovery this year has put the battery metal back in the spotlight after a prolonged downturn.
Lithium carbonate prices in China have risen roughly 80% this year, reaching as high as ¥20,000 ($4,200) per tonne, helping the market recover from a three-year slump.
Supply concerns have played a major role in the rebound.
A major Chinese lithium mine was shut last year over permitting issues, removing an estimated 8–10% of the country’s production. Zimbabwe has also tightened controls on raw lithium exports, ultimately introducing a quota system.
At the same time, demand continues to grow beyond electric vehicles (EVs), with battery energy storage systems emerging as another major source of lithium consumption.
By 2040, global lithium demand is forecast to more than triple from current levels, according to the International Energy Agency (IEA). Benchmark Mineral Intelligence (BMI) estimates supply will need to nearly quadruple to meet projected battery demand.
Together, these trends are putting greater focus on diversifying lithium supply, with Western governments increasingly looking to support new projects outside the industry’s traditional production centres.
Québec lithium in spotlight
One area attracting attention is Canada’s Eeyou Istchee James Bay region in Québec, which is already home to numerous hard-rock lithium discoveries and development projects.
Among them is Q2 Metals’ (TSX-V:QTWO) Cisco Lithium Project.
Earlier this year, Q2 released Cisco’s maiden NI 43-101 mineral resource estimate (MRE), outlining 295 million tonnes of inferred resources grading 1.36% lithium oxide (Li₂O).
At nearly 10 million tonnes of lithium carbonate equivalent, Q2 says the resource positions Cisco as the largest hard-rock lithium deposit in the Western Hemisphere and the fourth largest globally.
And exploration remains at a relatively early stage.
The current resource covers only a portion of the project’s 41,253-hectare footprint, with Q2 having explored Cisco for just over two years.
The company is now focused on expanding and upgrading the resource.
Largest drill program yet
Following the maiden resource, Q2 announced plans to raise C$60 million ($61 million) to advance work at Cisco. Strong demand subsequently led the company to increase the financing to C$70 million.
The funding is supporting Q2’s largest field program at Cisco to date, including approximately 20,000m of summer drilling.
“With the successful completion of a C$70 million bought deal financing backed by strong institutional support validating our vision for Cisco, we are embarking on our next phase of growth with significant momentum against the backdrop of a strong lithium market,” President and CEO Alicia Milne said in May.
Vice President of Exploration Neil McCallum says the maiden resource also highlighted the project’s remaining exploration potential.
“The MRE established the Cisco Project as a leading spodumene pegmatite asset while also highlighting the substantial exploration upside and discovery potential that exists across the broader project area,” McCallum says.
“Importantly, the Cisco deposit remains open in all directions and several known spodumene pegmatite outcrops in and around the Cisco deposit have yet to be drill tested, reinforcing the potential for continued resource growth.”
The program is prioritising infill drilling within the main Cisco deposit to convert existing inferred resources to the indicated category.
Drilling will also target potential ‘high-grade’ and near-surface zones, extensions around the existing deposit, the CO2 outcrop, and the southern portion of the deposit area.
Four diamond drill rigs were on site when drilling began in mid-June, with another two planned to be added during the summer.
‘High-grade’ results
The summer campaign follows a 10,515m winter drilling program completed in April across 19 holes.
Results included an intersection of 170.2m at 1.99% Li₂O, including 40.1m at 2.89% Li₂O. Another hole returned 215.6m at 1.69% Li₂O, including 64.6m at 2.29% Li₂O.
The final batch of winter assays, released in late July, included 137.6m at 1.47% Li₂O, including 40.6m at 3.25% Li₂O.
Q2 says the result further defined a ‘high-grade’ sub-zone within the main mineralised body at Cisco.
Another hole intersected 185.7m grading 1.54% Li₂O, with more than 100m of the interval extending beyond the conceptual open pit used in the maiden MRE.
“[These results] reinforce our confidence that Cisco remains a growing system with substantial upside,” McCallum says.
PEA underway
Alongside exploration, Q2 has started work on a preliminary economic assessment (PEA) to provide an initial evaluation of Cisco’s economic potential.
The study will incorporate the current resource estimate, metallurgical test work completed in 2025, and infrastructure studies undertaken by the company. Publication is targeted for the northern autumn of 2026.
The first phase of metallurgical work used heavy liquid separation to assess the suitability of dense media separation.
A second phase is now underway to test recovery variability across different pegmatite textures and examine the effects of wall-rock dilution on recovery and iron content.
Flotation testing will also be undertaken to compare potential processing flowsheets and determine whether recoveries can be improved.
Q2 has also started baseline environmental studies across Cisco and the surrounding area, covering water, wetlands, vegetation, wildlife, fish habitat, and other environmental conditions.
The work is intended to support future project planning, permitting, engineering, and stakeholder engagement as Cisco moves beyond exploration.
Team expands
Meanwhile, Q2 has also expanded its management team as work on the PEA progresses.
The company recently appointed Jean-François Tremblay as vice president of technical services to lead technical programs related to the PEA and subsequent development work.
Tremblay has more than 25 years of technical and operational experience and has previously held roles with Elemission, Arcadium Lithium, Nemaska Lithium, BBA Consultants, Niobec, and Glencore (LSE:GLEN).
Q2 also appointed Dr Geneviève Morinville as vice president of sustainability and regulatory affairs, who will be responsible for the company’s environmental, sustainability, and regulatory initiatives.
Morinville brings more than 20 years of experience in environmental, social, and governance matters, primarily in Canada’s mining industry, including her work in the Eeyou Istchee James Bay region.
Q2 says the two appointments will support Cisco’s transition from exploration through the PEA and into subsequent engineering and development stages.
Q2 Metals is a Canadian mineral exploration company focused on advancing the Cisco Project within the greater Nemaska traditional territory of the Eeyou Istchee James Bay region of Québec.
Write to Jackson Chen at Mining.com.au
Image: Q2 Metals
