Albemarle Corp has entered into an exclusive deal with
Australian miner Mineral Resources (MRL) that may lead to the
development of new battery-grade lithium hydroxide plant in
The companies have agreed to consider the creation of a JV
that would own and operate the Wodgina hard rock lithium mine
and ultimately develop an integrated lithium hydroxide
operation at the site. Albemarle would manage the marketing and
sales of the lithium hydroxide produced by the project.
Wodgina is in the Pilbara region of Western Australia, and
is a hard rock lithium deposit with an estimated mine life of
more than 30 years.
Albemarle, which is based in the United States, would
acquire a 50% interest in all mineral rights within the Wodgina
tenements. This would, however, exclude iron ore, which would
be retained exclusively by MRL, and tantalum, which would
remain held by a third party.
The global speciality chemicals company would also own half
of a planned spodumene concentration plant at Wodgina, with
capacity for as much as 750,000 tonnes per year of 6% spodumene
concentrate that will in turn be used as feedstock for the
proposed lithium hydroxide plant.
The lithium hydroxide plant would produce at least 50,000
tpy of battery-grade material in the first stage, which would
be increased to at least 100,000 tpy in the second stage.
Albemarle would pay $1.15 billion for its 50% stake in the
joint venture, which it expected to fund with available cash
and new credit facilities. The transaction is expected to be
accretive to Albemarle’s earnings.
"This agreement is consistent with our corporate strategy of
pursuing M&A [merger and acquisition] opportunities that
can accelerate and de-risk our organic growth strategy,"
Albemarle chief executive officer Luke Kissam said.
"We feel confident in leveraging this world-class lithium
resource with an experienced and knowledgeable mining company
such as MRL to help meet the growing demands of our global
customers," he added.
Increasing global demand for electric vehicles, mobile
devices and grid storage has created a supply-led surge in
prices for lithium, a key raw material for batteries.
Downstream demand has slowed recently, however, with the spot
price of battery-grade lithium hydroxide monohydrate (min
56.5% LiOH.H2O) at 110,000-120,000 yuan per tonne on November
15, unchanged since October 11, according to