Lithium Australia increases share in Charger Metals with project sale

Lithium Australia has entered into a binding agreement to sell its 30 per cent share in the Lake Johnston lithium project to Charger Metals as the company concentrates on its battery recycling portfolio.

The agreement will see Charger take 100 per cent control of the project to the west of Norseman in WA and grants Lithium Australia first right of refusal for offtake of up to 30 per cent of lithium produced at the site.

Once Charger receives shareholder approval for the acquisition, it will issue Lithium Australia seven million fully paid ordinary shares as consideration for the sale of the project. Lithium Australia says the shares represent a value of around $2.9 million based on the previous closing price of Charger.

In July last year Charger exercised its option to acquire a 70 per cent interest in Lithium Australia’s Coates, Bynoe and Lake Johnston projects. As a result of the cash and script deal, Lithium Australia retained a 30 per cent free carried interest in those projects and also became the major shareholder in Charger. Once the latest agreement is finalised, Lithium Australia will hold a relevant interest of 24 per cent in Charger.

Lithium Australia Chief Executive Officer, Simon Linge said: “Our primary focus areas are the growth of our battery recycling division and commercialisation of lithium ferro phosphate cathode powders. Importantly, this acquisition agreement maintains the company’s rights for lithium chemicals from the Lake Johnston lithium project, defined under the original acquisition and JV agreement.”

Lithium Australia has been focused on its battery recycling work for the past 12 months. In December it chalked up a major milestone on its journey to commercialising a rival to traditional lithium-ion batteries with completion of an engineering study for a pre-qualification pilot plant.

The company says it is eventually aiming for a manufacturing plant that can produce a minimum of 10,000 tonnes per annum of lithium ferro phosphate, or “LFP”– a move the company believes will make it one of the few significant LFP producers outside China.

The study aims to support a proposal to expand its current pilot facility to a size able to provide sufficient samples for prospective customers to trial. The company expects it will help determine the optimal commercialisation pathway in addition to allowing engagement with offtake and joint development partners.

The study was conducted by Lithium Australia’s wholly owned subsidiary VSPC which is based in Queensland. VSPC has patented technology that challenges conventional rechargeable lithium-ion batteries that use lithium cobalt oxide which VSPC argues are toxic and unstable at high temperatures.

VSPC has developed a process to produce nanometre-sized grains of LFP metal oxides the company says displays enhanced physical, electrical, optical and mechanical properties not currently available in the lithium-ion battery market.

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