Pil­bara Min­er­als signs lithium deal

Pilbara News - - News - Nick Evans

Pil­bara Min­er­als boss Ken Brins­den has flagged a quick de­ci­sion on a po­ten­tial move into down­stream pro­cess­ing as the com­pany last week locked in its first bind­ing off­take agree­ments from its Pil­gan­goora lithium project.

Pil­bara Min­er­als last week an­nounced an un­named Chi­nese lithium car­bon­ate pro­ducer had signed a bind­ing agree­ment to buy at least 140,000 tonnes of con­cen­trate a year, about 40 per cent of its planned 330,000t con­cen­trate pro­duc­tion, as well as to pump $17.8 mil­lion into the com­pany in a 50cent-a-share place­ment.

The deal comes with an agree­ment to ex­am­ine op­tions to es­tab­lish a joint ven­ture to process Pil­bara Min­er­als’ 6 per cent lithium con­cen­trate into lithium car­bon­ate or lithium hy­drox­ide.

Mr Brins­den said the com­pa­nies hoped to com­plete early-stage scop­ing stud­ies on the plant, to be built out­side China, by the end of Septem­ber.

Galaxy Re­sources’ dis­as­trous at­tempt to build its own lithium car­bon­ate plant in China cast a pall over any thoughts of other lo­cal lithium hope­fuls pur­su­ing the down­stream value chain.

Mr Brins­den said the com­pany was con­fi­dent its part­ner had the ex­per­tise nec­es­sary to build and op­er­ate the plant.

“We’re a min­ing com­pany, we can’t pre­tend to be a chem­i­cal com­pany in the short to medium term, so why bother try­ing to do it on your own when the ex­per­tise is read­ily avail­able?” he said.

“We have (ac­cess to) ex­ist­ing op­er­at­ing skills, ex­ist­ing tech­nol­ogy, ex­ist­ing in­tel­lec­tual prop­erty, and all you have to do is trans­late that to an­other lo­ca­tion.

“I think that’s a much lower path to down­stream par­tic­i­pa­tion and I’m con­vinced we’ve got the right part­ner to achieve that model.”

Mr Brins­den said it had not been able to name its part­ner be­cause it was in­volved in sep­a­rate sen­si­tive com­mer­cial dis­cus­sions in China, but hoped that those is­sues would be re­solved within weeks.

He said the off-take deal was the first of sev­eral the com­pany ex­pected to an­nounce in com­ing weeks, say­ing the in­ter­est in the com­pany’s prod­uct was strong enough that it could con­sider ex­pand­ing the project’s size.

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