The Superior Court of Quebec ordered Nemaska Lithium Inc. to distribute proceeds from its canceled US$350 million senior secured bonds offering.

In May 2018, the company priced and closed the books on the offering of bonds after launching it in the previous month.

However, Nemaska Lithium scrapped it after an updated NI 43–101-compliant technical report flagged a delay in the completion of the Whabouchi lithium project and the Shawinigan electrochemical plant in Quebec, which was originally set for June 2021.

The company said Dec. 5 that the claim under the bond terms that is secured on a first-ranking basis will be reduced to US$100 million from US$350 million. Proceeds will be distributed within 15 business days of Nov. 27.

A hearing on Nemaska Lithium's application to discharge the security that secured the bonds is set in January 2020. While Nemaska Lithium believes that the bonds were discharged, bond services provider Nordic Trustee thinks otherwise and believes that the company owes penalties to bondholders.

Nemaska Lithium is dismissing 64 employees at Whabouchi to keep the project running while ensuring optimization of current cash flow.