ASX-listed Galaxy Resources
Ltd and General Mining Ltd have
signed an offtake agreement with a Chinese buyer for 60,000
tonnes lithium concentrate at a price of $600/tonne (FOB, min
5.5% Li2O) from the soon to be reopened Mt Cattlin spodumene
mine near Ravensthorpe, Western Australia (WA).
Half of the $36m revenue from the deal
will be paid as a prepayment by the customer by the end of this
month. Delivery of the product is due this year.
The companies have agreed to deliver a
further 120,000 tonnes lithium concentrate in 2017 to the same
customer at a sale price to be agreed in Q4 2016.
Anthony Tse, Galaxy’s
managing director, said that the company expects "to continue
to see strong growth in end user demand from a diverse range of
end user applications".
"Coupled with an ongoing limited response
on the supply side for the near term, lithium feedstock will
remain in very high demand, and as such pricing will continue
to be very robust going into 2017," he added.
Galaxy cited growth in the Chinese
electric vehicle (EV) sector as a driver of this demand.
600,000 EVs are expected to be sold in China this year, up from
379,000 in 2015, said Galaxy, citing Chinese government
Mt Cattlin is owned by Galaxy Resources,
but will be operated by General Mining. Galaxy has indicated
that the first shipment of concentrate from the project will be
made in July or August this year, before the plant achieves
full optimisation in December. A total of 65,000 tonnes lithium
concentrate is expected to be produced in 2016.
TSX-V listed lithium juniors,
Nemaska Lithium Inc. and Western
Lithium USA Corp. are confident that they will soon
secure the funding needed to develop their respective projects,
despite difficulties encountered by junior miners generally,
Reuters has reported.
"Given the fundamental shift in energy
demand, nothing's easy, but [raising capital is] very doable,"
Tom Hodgson, Western’s CEO, said at the
Prospectors and Developers Association of Canada (PDAC) convention in
Toronto, which is taking place this week.
Western hopes to bring its
Caurchari-Olaroz project in Argentina online in 2018 at a cost
Guy Bourassa, CEO of Nemaska, meanwhile,
said he expects to have completed fundraising of Canadian
dollar (C$) 521m ($390.72m*) within a year, to finance the
Whabouchi project in Quebec, Canada.
TSX-V and UK AIM-listed Bacanora
Minerals Ltd has published results from an NI 43-101
pre-feasibility study (PFS) on its Sonora lithium project
in northern Mexico.
The PFS anticipates production of 17,500
tpa lithium carbonate for the first two years of operation, to
be ramped up to 35,000 tpa thereafter. The site also has the
potential to produce up to 50,000 tpa potassium sulphate.
Sonora has an estimated pre-tax internal
rate of return (IRR) of 29% for a net present value (NPV) of
$776m, at an 8% discount rate.
The project has an indicated resource of
5m tonnes lithium carbonate equivalent (LCE) and an inferred
resource of 3.9m tonnes LCE.
Sonora, which attracted international
attention last year after Bacanora signed a provisional offtake deal
with US EV maker, Tesla Motors Inc., will now
move immediately to feasibility study stage.
Separately, Rare Earth Minerals
Plc (REM), also listed on the UK AIM, which owns a 17%
stake in Bacanora, has increased its ownership of ASX-listed
European Metals Holdings Ltd (EMH), owner of
the Cinovec lithium deposit in the Czech Republic, to
REM purchased a further 7.9% stake in EMH
at a cost of £670,000 ($951,541), as part of an overall
Australian dollar (A$) 1.755m ($1.303m) raised by the latter to
fund a drilling campaign targeted at upgrading
Cinovec’s current inferred mineral resource of
514.8m tonnes ore at 0.43% Li2O.
ASX-listed Orocobre Ltd
increased production at its Olaroz lithium carbonate facility
in Argentina to 725 tonnes in February, up from 699 tonnes in
January and 427 tonnes in December.
Orocobre is currently ramping up
production at Olaroz, following the clearing of various bottlenecks in 2015
which prevented the project from reaching break even capacity,
which it finally achieved last month.
The company said it retains a production
guidance of 2,400 tonnes lithium carbonate for the current
Fellow ASX-listed Hannans Reward
Ltd has entered into a "lithium knowledge and
technical assistance agreement" with Neometals
Ltd "to identify and advance European lithium
Following shareholder approval, Hannans
intends to demerge its subsidiary, Scandinavian
Resources, in which Neometals will take a 13.5% stake
through the purchase of 62.5m shares, priced at
Lithium Australia NL has
defined two areas for initial drill work on the southern part
of its Ravensthorpe tenements in WA.
It has specified an exploration target of
minimum 1% Li2O, with a size range from
525,000-1.281m tonnes and a grade range of 0.8%-1.2%
A maiden drilling programme of up to 35
drill holes on the site’s Horseshoe pegmatites is
scheduled to begin once approvals have been confirmed.
Peninsula Mines Ltd has
been granted a trading halt pending details of a capital
The company last week filed for 53
tenement applications over an area prospective for
lithium-bearing pegmatites in South Korea.
The halt will remain in place either until
9 March or until an announcement is made to the market,
whichever is earlier.
Argonaut Resources NL,
has secured an exclusive option to acquire the Crescent Lake
lithium pegmatite project in Ontario, Canada from
Canadian Orebodies Inc.
The project comprises two adjacent
deposits, Zigzag and Falcon Lake, defined by two phases of
drilling – historic diamond core drilling carried out
in the 1950s and limited modern diamond drilling in 2011, plus
TSX-V-listed Lithium X Energy
Corp., has entered into a binding letter of agreement
with TSX-listed Aberdeen International Inc. to
acquire up to 80% of the latter’s subsidiary,
Potasio y Litio de Argentina SA, owner of the
Sal de los Angeles lithium-potash brine project in
The project, previously known as the
Diablillos project, comprises 32 mining claims over 8,156 ha
(81.56km2), near to FMC
Corp.’s Salar de Hombre Muerto
Houston Lake Mining Inc.,
also TSX-V-listed, announced a NI 43-101 mineral resource
estimate for its PAK lithium project in northwest Ontario.
The estimate gave the sited a measured and
indicated resource of 7.89m tonnes at 1.73% Li2O,
including 6.87m tonnes at 1.96% Li2O.
The study also estimated the site to have
an inferred mineral resource of 295,600 tonnes at 1.35%
Li2O, including 228,700 tonnes at 1.69%
Ultra Lithium Inc. has
received the results of a controlled source audio-frequency
magneto-telluric (CSAMT) ground geophysical survey at its South
Big Smokey Valley lithium brine project in Nevada, US.
The company said that the study identified
several targets representing potential lithium bearing brines
and structural traps favourable for brine accumulation in two
Resolve Ventures Inc. has
entered into an interim agreement with Nevada Sunrise
Gold Corp. to earn up to a 50% working interest in the
Neptune lithium property in Clayton Valley, Esmeralda County,
Neptune comprises 316 unpatented placer
claims covering around 6,320 acres (25.6km2).
Resolve also said it intended to complete
an equity financing to raise proceeds of up to C$500,000.
Separately, Nevada Sunrise has begun a
drilling programme at Neptune, following approval by the
US Bureau of Land Management for 10
exploration drill holes.
The company said it plans to drill up to
three vertical holes to depths of 380-480 metres as an initial
test of the interpreted sub-basin.
Zadar Ventures Ltd has
entered into an option agreement with Arizona, US-based
GeoXplor Corp. to acquire two prospective
lithium projects in Clayton Valley.
To exercise the option, Zadar will have to
issue 5m common shares and pay $450,000 in cash. It will also
be required to make a number of specified exploration
expenditures and pay annual royalty payments to GeoXplor.
Also in Clayton Valley, CSE-listed
Matica Enterprises Inc. said it had completed
sampling work at its McGee claims, which cover around 1,140
acres (4.6km2) in the valley’s
The company said that this was the second
round of sampling of outcropping claystones at McGee.
It noted that "while Matica is still at a
very early stage of exploration and [is] only beginning to
understand the stratigraphy of the basin fill evaporate and
volcanic ash units, it seems reasonable to expect that the
outcropping stratigraphy at the McGee claims will persist to
depths below the water table".
Iconic Minerals Ltd has
filed an application with the state of Nevada, US, to
appropriate groundwater for its Bonnie Claire lithium project
in Nye County.
The company intends to use the water
obtained to explore for lithium brines and, if successful at
this stage, later for lithium extraction and production
In financing news, ASX-listed
Altura Mining Ltd has settled a share
placement with Lionergy Ltd for A$3m.
The income from the issue of just over 37m
fully paid ordinary shares will be primarily directed towards
the development of the Pilangoora lithium project, including
completion of a feasibility study (FS) expected later this
In downstream news, Toyota
Australia has told automotive magazine, Car
Advice, that it has opted to retain use of a nickel-metal
hydride (Ni-MH) battery for the fourth generation Toyota Prius,
rather than switching to the lithium-ion (Li-ion) system used
in other markets.
Tony Cramb, executive director of sales
and marketing of Toyota Australia cited the reliability and
cost of the Ni-MH battery as the reason for the decision.
"We have had no issues with it and for
this model we’ve decided to stay with it," he said
at the new model’s launch.
"One day, lithium will be the future but
for the time being, nickel hydride is the most appropriate for
here in Australia," he added, noting that Li-ion battery
technology will continue to fall in price.
Daimler AG will invest
€500m ($549.13m) into a second Li-ion battery plant,
adjacent to its current facility in Kamenz, Germany.
The new plant will triple the production
capacity of its battery producing subsidiary Deutsche
ACCUMOTIVE and produce batteries for use in
Mercedes-Benz and smart
hybrid and electric vehicles.
*Conversions made March 2016