Chinese increase Lithium off take contract at Mt Marion by 250%

Insatiable demand for Lithium in China, one of the worlds significant battery markets, has seen ASX listed Neometals off take partner at the Mt Marion project increase their contracted take or pay commitment for lower grade Lithium by 250%.

Chinese company Ganfeng Lithium are one of Neometals partners in the Coolgardie based project and they are also the off take partner for the Lithium Oxide chemical grade spodumene concentrate that will be produced at Mt Marion.

Ganfeng initially committed to take everything the mine could produce with a Lithium Oxide grade of 6% or greater but later revised their contract to also take or pay for an additional 80 000 tonnes of the lower grade 4%-6% Lithium product per year.

In a sure fire sign that the Chinese Lithium market is about to hit its straps, Neometals this week announced that Ganfeng have committed to take or pay for yet another 120 000 tonnes of the lower grade 4%-6% product taking their total annual commitment for the lower grade product to 200 000 tonnes and 100% of the higher 6% product.

Ganfeng’s commitment to also take the lower grade product follows on from metallurgical test work showing that an additional lower grade spodumene product could be generated through the implementation of a flotation circuit to the current beneficiation plant.

As one of the key minerals required to build Lithium-ion batteries, Lithium is in hot demand right now, especially with electric car manufacturer Tesla really capturing the world’s attention.

Tesla have already taken more than 325 000 “pre-orders” for their new electric vehicle known as “Model 3” due out in about 18 months.

It is estimated that by 2021, Tesla alone will be consuming 7200 tonnes a year of Lithium Hydroxide and 10 800 tonnes of spherical graphite to feed their Lithium-ion battery manufacturing plant. 

In terms of battery raw materials, this is the equivalent of 44% of the world’s battery grade lithium hydroxide and 15% of the world’s spherical graphite consumption in 2015.

Its no wonder the Chinese are jumping all over this and locking down whatever Lithium supply they can get regardless of grade.

Ganfeng Lithium have over 450 staff working across 300 acres and manufacturing a range of Lithium products in the Jianxsu Province in China.


Trigg WA
Neometals is likely to pursue a deal with its neighbour Maximus Resources to meet Ganfeng's insatiable lithium appetite. Maximus has identified a high grade surface deposit of lithium, the extent of which is the subject of a current drilling program.

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