SMM12, 21 March: recently, Australia's Neometals Mining Company announced that its shares in Mt Marion13.8% were sold at an average share price of A $104 million to Ganfeng Lithium and Mineral Resources, after the transaction. Ganfeng lithium and Mineral Resources will each share 50 per cent of the Mt Marion mine.
Upon completion of the divestment, Neometals and RIM will sign a mining option agreement under which Neometals will have the right to purchase up to 57000 tons (dry tons) of lithium concentrate from Mt Marion annually over the life cycle of the mine from February 2020. The underwriting price will be linked to the Mt Marion underwriting price of Ganfeng lithium industry and will be adjusted according to the taste basis of Mt Marion ore. The contract price is determined by the pricing of the formula, which is related to the previous price of lithium compounds. The spodumene acquired by Neometals must be used in its downstream lithium business, of which Neometals holds at least 25 per cent of the corporate or economic interest.
Neometals sold its stake in Mt Marion because of the company's downstream integration strategy. The company plans to shift to higher-value lithium chemicals and recover the value of key metals, including lithium, from waste lithium-ion batteries.
Chris Reed, managing director of Neometals, said the company was pleased with the outcome of the Neometals negotiations and that Neometals had achieved significant further value from Mt Marion while retaining valuable procurement rights. It provides an industry-certified raw material guarantee for downstream lithium processing and production. At present, the company is changing its focus from upstream lithium concentrate to a more integrated lithium battery theme.
