Kidman Resources’ shares have fallen for a second consecutive day, despite the company seeking to quell investor unease around its joint venture agreement with a Chile-based lithium producer.
Kidman today forwarded commentary from Sociedad Quimica y Mineara de Chile’s chief executive, Patricio de Solminihac Tampier, who said the company planned to begin production at the Mt Holland lithium operation near Southern Cross within the next two years.
Mr de Solminihac Tampier said SQM planned to consolidate three complementary lithium production plants around the world – Mt Holland, its Salar de Atacama project in Chile, and its Salar de Cauchari in Argentina.
“Regarding Mt Holland, we expect to accelerate the significant exploration and technical studies already undertaken by Kidman to move into production of spodumene concentrate within the next 24 months,” he said.
“With regard to the refining plant, we will advance that in parallel, with the objective to start production of lithium hydroxide and lithium carbonate on as short a timetable as possible after the concentrate operation is commissioned.”
But the commentary failed to reassure investors, with Kidman shares falling a further 4 per cent to close at 60 cents each. That's on top of a 12 per cent slide yesterday following the announcement of the JV agreement.
Mr de Solminihac Tampier said the Atacama, Cauchari and Mt Holland projects far exceeded SQM’s objectives.
“They are high-quality deposits with great potential for future growth, which will allow us to continue being operators with low total production costs in all of our plants,” he said.
“We believe it is highly probable that worldwide demand will exceed 500,000 tonnes by 2025.
“The use of lithium batteries in the automotive industry marks a trend that will revolutionise global demand in the coming years.”
