Chinese battery giant takes stake in St George Mining

St George Mining has welcomed Chinese lithium-ion battery maker Sunwoda Electronic onto its share registry via a $2m placement as it eagerly awaits results from a maiden drill campaign where visible lithium-bearing minerals were spied at its Mt Alexander project in WA’s Goldfields.

Sunwoda subsidiary Hongkong Xinwei Electronic has agreed to the placement at 8.6c per share, a 0.3c premium to St George’s high-water mark in the past three months.

The battery maker’s entry into St George will strengthen collaboration on the development of lithium projects, grant Sunwoda first right of refusal for up to 15 per cent of lithium from Mt Alexander and open the doors to the Chinese company’s global network of high-tech manufacturing bases.

Sunwoda brings strong credibility as one of the world’s largest lithium-ion battery manufacturer for the likes of cars, mobile phones, laptops and energy storage devices.

It is the third such deal St George has struck with Chinese firms in recent months following similar arrangements with Great Wall Motors-backed SVOLT energy and Shanghai Jayson New Energy Materials.

St George Mining Executive Chairman John Prineas said "this strategic investment recognises the exciting lithium opportunity at Mt Alexander and further highlights St George’s strong success in developing key industry relationships with some of the largest and most important global players in lithium-ion batteries.” Only use this para for the pull quota”​

“Our strategic relationship with Sunwoda will strengthen our ability to both advance Mt Alexander and to potentially generate and partner on additional lithium projects in Western Australia, which is the world’s best hard-rock lithium address.”

“Lithium is a critical element required to underwrite the multi-decade energy transition that is underway, which we believe assures strong long-term demand for this commodity.”

Whilst the boardroom was busy putting pen to paper, work out beyond the black stump was also churning out promising results.

A maiden drill campaign latching onto Mt Alexander’s pegmatite outcrops intersected visual lithium-bearing minerals along a 1.7km strike.

Those pegmatites start at the surface, where rock chips bearing 3.25 per cent lithium were found, run 200m down and in many cases remain open at depth.

With assays off to the lab St George is charting an extensive 20,000m drill campaign in 2023 to poke around a 13km corridor which has so far remained largely unexplored.

Some 79 rock chip samples from north of the drill site are still being picked over at the lab but have already piqued St George’s interest due to presence of fractionated pegmatites.

“These results continue to indicate the potential for a large lithium bearing pegmatite mineral system at Mt Alexander, the full scope of which is still evolving as we continue work across the Project,” said Mr Prineas.

“Importantly, the success of the drill program means we end 2022 with significant momentum that will carry through into the New Year, with plans to resume drilling in as early as February.”

Mt Alexander sits 250km north of Kalgoorlie along a band of nickel mines including BHP’s Mt Keith and Leinster operations and IGO’s 67Mt at 0.98 per cent nickel Cosmos mine.

Five tenements are wholly owned by St George and IGO holds a 25 per cent stake in a fifth central pegging.

The Federal Government’s Resources and Energy Quarterly report on Monday tipped lithium hydroxide prices would continue to climb to US$61,200 in 2023 before contracting below US$50,000 in 2024 as more supply came online.

Spodumene prices meanwhile are flagged to continue a stellar run from US$598t in 2021 to US$4000 next year before following a similar downward trend to about US$3100 in 2024.

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