28/10/2015 - 15:21

General Mining, Mitsubishi offtake deal

28/10/2015 - 15:21

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Production is a step closer to restart at the Mt Cattlin lithium mine, with General Mining Corporation signing a four-year offtake deal with Mitsubishi Corporation.

The Mt Cattlin project.

Production is a step closer to restart at the Mt Cattlin lithium mine, with General Mining Corporation signing a four-year offtake deal with Mitsubishi Corporation.

The agreement will cover 100 per cent of the spodumene (lithium) concentrate produced at Mt Cattlin, and will have an option for a one-year extension.

Mitsubishi will sell into China, Taiwan, South Korea and Vietnam, were lithium demand is rising thanks to a range of technological applications and the expansion of the battery market.

The Japanese giant will also be covered by an exclusivity clause not to source spodumene from any other projects for those markets.

Galaxy shuttered the mine, near Ravensthorpe, in mid-2012.

General then bought the rights to operate the resource for $7.5 million in February this year, as Galaxy sought to cut its debt burden.

It raised $3 million this year to fund development costs at the project, which will cost $14.7 million to bring back into operation.

General Mining executive chairman, Michael Fotios said the company was delighted with the agreement.

“This binding agreement with an international tier one trading house offers exclusive and unrivalled access in four priority markets where demand for battery grade spodumene concentrate is robust,” he said.

“Importantly, it marks another key milestone in our pathway to production at Mt Cattlin targeted for commencement in the first quarter of 2016.”

The project is expected to have a 15-year mine life.

Shares in General were down 5.2 per cent at the close of play to 18.5 cents each.

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