St George Mining has entered a memorandum of understanding with global battery giant SVOLT Energy Technology to collaborate on lithium projects including the explorer’s Mt Alexander operation near Leonora in Western Australia.
The agreement establishes a framework for St George and SVOLT to negotiate and consider entering a range of commercial transactions for investment and offtake opportunities relating to lithium projects in Australia.
According to the agreement, SVOLT can potentially invest up to $5 million in St George by way of a placement of shares, can negotiate a potential offtake agreement with the explorer for up to 25 per cent of spodumene concentrate from Mt Alexander in addition to entering a potential joint venture to acquire and develop new lithium projects. The agreement only applies to projects 100 per cent owned by St George and has an initial term of two years. Any investment in St George by SVOLT is subject to agreement on pricing and completion of due diligence.
St George says SVOLT is one of the world’s largest manufacturers of batteries for electric vehicles and energy storage, with operations in domestic China and abroad that supply batteries to more than 30 automobile makers in addition to other customers. SVOLT also pioneered the first mass-produced cobalt-free battery.
St George Mining Executive Chairman, John Prineas said: “Our strategic relationship with SVOLT will strengthen our capacity to accelerate exploration and development at the project – particularly through the provision by SVOLT of technical advice for the marketing of lithium products as well as the potential provision of development funding.”
St George is currently completing its maiden drill campaign at Mt Alexander to test several pegmatite outcrops where high-grade lithium mineralisation has been confirmed by assays of rock chip samples.
Last month analysis of its first batch of 10 samples returned grades as high as 2.72 per cent lithium oxide. Additional rock chip results include 1.97 per cent, 1.15 per cent, 1.68 per cent and 2.72 per cent lithium oxide. St George picked up the samples from a series of stacked pegmatite dykes in a north-south zone of the project at its recently identified Jailbreak prospect.
The strategic relationship with SVOLT is similar to a deal St George made with Shanghai Jayson New Energy Materials last month that includes potential funding support for St George to enable business expansion, the acquisition and enhancement of new lithium exploration projects in addition to the development of downstream lithium assets in Western Australia. The agreement also outlines a first right of refusal for Shanghai Jayson to secure at least 20 per cent of the offtake from Mt Alexander and any joint venture projects.
St George says SVOLT was established as an independent battery manufacturer in 2018 following a spin-off from Great Wall Motor Company, one of the world’s largest vehicle manufacturers with more than 10 years’ experience in the research and development of batteries.
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