Xianmei Resources invests in Battery-grade Lithium Salt to develop New Energy Strategy Racetrack

China's leading manufacturer of tantalum and niobium metallurgical products, Xianmei Resources Holdings Co., Ltd. (9936.HK, hereinafter referred to as "Xianmei Resources" or the "Company"), is pleased to announce on November 18, 2021, the establishment of a joint venture company to invest in the 50,000 tons of battery-grade lithium salt circular economy industrial park project. Xianmei Resources is the world's leading manufacturer of wet tantalum and niobium products. This foray into the lithium battery core raw material industry will help the company to open up a new strategic track on the basis of the original advantageous industries and become an important driving force for the company's future business growth and competitiveness.

Battery-grade lithium salts have a broad prospect.

The registered capital of the newly established project company is RMB 200 million, and the contribution of Ximei Resources is about RMB 37.3 million, accounting for about 18.66% of the shares of the project company. The project company will build an annual production capacity of 50,000 tons of battery-grade lithium salt circular economy industrial park in Sichuan Province. the main products are lithium salts, an important material of lithium batteries. The project will be divided into two phases: the first phase will produce 23000 tons of battery-grade lithium salt per year, and the second phase will add 27000 tons of battery-grade lithium salt.

The battery-grade lithium salt invested by Xianmei Resources has a broad market prospect, which is in line with the orientation of China's carbon-neutral economic development and the support of relevant industrial policies. On November 2, 2020, the New Energy vehicle Industry Development Plan (2021-2035) issued by the General Office of the State Council announced that it put forward clear development goals and tasks for the development of new energy vehicles in the next 15 years. By 2025, the sales of new energy vehicles will reach about 20% of the total sales of new vehicles, and pure electric vehicles will become the mainstream of new sales vehicles by 2035. There is a huge space for the development of new energy vehicles in the future, and the lithium battery industry, as the core component of new energy vehicles, will also flourish.

According to the (GGII) statistics of the Institute of Lithium electricity of High Industrial Research Institute, China's lithium battery shipments in 2020 were 143GWH, an increase of 22% over the same period last year. China's lithium battery market is expected to reach 615GWhWH shipments in 2025 at a compound growth rate of more than 25% a year from 2021 to 2025.

Battery-grade lithium salt (including battery-grade lithium hydroxide, battery-grade lithium carbonate, etc.) is the key raw material for the production of lithium battery. with the continuous growth of lithium battery production scale, there will be a strong demand for lithium salt. It is the right time for Xianmei Resources to enter the battery-grade lithium salt industry at this time.

To rise abruptly based on accumulated strength embodies unique advantages.

This investment in battery-grade lithium salt gives full play to the team, technology, experience, resources and customer advantages that the company has accumulated for many years in the non-ferrous metal metallurgical industry.

As the main wet smelting plant of tantalum and niobium in China, Xumei Resources has a management and implementation team rooted in the non-ferrous metal metallurgical industry for many years, and has rich experience in the construction and operation of smelting projects. it has established a good reputation in the industry, and has a deep accumulation in upstream ore raw material suppliers and downstream domestic and foreign customers.

The partners of this project also have rich experience and unique advantages in the investment, trade, production, technology and resource integration of non-ferrous metals, especially lithium salt products. Work together to promote the smooth implementation of the project in the future.

Product upgrade to meet the outbreak of demand

At present, the main products of Xianmei Resources include tantalum oxide, niobium oxide and other tantalum and niobium wet products, which are widely used in the manufacture of special alloys, high-end consumer electronics, chemicals, aerospace, cemented carbide and other high-tech industry products. At present, with the rapid development of downstream industry, 5G network infrastructure, electric vehicles, fast charging, semiconductors, chips and other fields ushered in explosive growth, driving the rapid development of upstream tantalum and niobium industry.

Xianmei Resources is one of the few enterprises in China that have the ability to produce wet tantalum and niobium products with a purity of up to 99.995%. They can produce a variety of customized products to meet customer differentiation requirements. With the help of technology and R & D advantages, Xumei Resources is accelerating the upgrading and upgrading of products, further releasing the output of high value-added products, such as high-purity niobium oxide, high-purity tantalum oxide, special-purpose high-purity products, etc., to promote high-quality development in an all-round way.

It is worth noting that niobium, one of the main products of Xianmei Resources, has been widely used in lithium electronic battery materials, such as positive doping materials, niobium plays an important role in improving electronic conductivity and stability. At present, niobium oxide for batteries produced by Xianmei Resources has formed large-scale sales, and accumulated good customer resources. At the same time, tantalum-niobium ore and lithium ore are associated ores to a large extent, and Xiumei resources also have obvious advantages in the acquisition of lithium ore. The good synergistic effect of Xianmei Resources and Lithium Salt Project in the supply chain and client will help the project to achieve greater development.

The new industrial layout is ready to start.

On the basis of further consolidating the leading position of tantalum-niobium hydrometallurgical products, Rumei Resources is also actively extending to the tantalum-niobium pyrometallurgical products in the lower reaches of the industrial chain.

Since its listing in March 2020, the company has successively invested in two pyrometallurgical product projects, namely, the 600t tantalum-niobium metal material project in Qingyuan, Guangdong, and the 1500-ton tantalum-niobium metal material project in Qianxinan Prefecture, Guizhou Province. The main products of these two projects are tantalum powder, tantalum bar, niobium bar, niobium ingot, etc., each production line is entering the stage of putting into production one after another, the industrial layout of rare beautiful resources will be further expanded and improved, and the product line will be more abundant.

In March 2021, Xianmei Resources established a joint venture with CNNC Huachuang, a central enterprise, to produce tantalum and niobium products in Hunan Province, further expand wet process production capacity, and continue to consolidate the company's leading position in wet process products in the country.

This foray into the lithium battery core raw material industry is another strategic development move of Xianmei Resources after its listing, which will open up a new race track on the basis of the company's original advantageous industries, and the broad prospect of the battery-grade lithium salt industry will drive the rapid development of the company's business in the future.