On 4 July, European Lithium and the Saudi-based Obeikan Group for Investment Company have formalized their partnership with the execution of a Shareholders Agreement. This agreement sets the groundwork for a new lithium hydroxide processing plant in Saudi Arabia.
The joint venture, named Arabian New Energy, will be a 50-50 partnership between the two entities. The incorporation of Arabian New Energy will proceed following registration and approval by Saudi regulatory authorities.
The shareholders agreement grants Arabian New Energy exclusive rights to purchase spodumene from Wolfsberg's Zone 1. The concentrate will be sold at a reduced rate with a floor and ceiling price structure.
The plant will then process spodumene concentrate from European Lithium's Wolfsberg Lithium Project in Austria, producing 10,000 tonnes of lithium hydroxide per year. The facility's development will adhere to initial capacity and product specifications outlined in a long-term supply agreement with BMW, announced in December 2022.
A development committee will oversee all key decisions regarding the plant's construction. The agreement will become binding once Critical Metals Corp (CRML), which European Lithium holds a majority stake in, signs the necessary deeds. Tony Sage, Executive Chairman of European Lithium, stated that the next steps include finalizing an updated definitive feasibility study (DFS) and securing construction funding within Saudi Arabia.
Author: Hongqiu Su | Battery Metals Analyst Associate | London Office, Shanghai Metals Market
Email: lilysu@smm.cn
