Ganfeng ups Mt Marion offtake

Chinese manufacturer Ganfeng Lithium has more than doubled its offtake agreement with Mineral Resources and Neometals for the Mt Marion project, as  interest in the commodity continues to build.

The new agreements are for 200,000 tonnes per annum of spodumene concentrate, which is processed to form lithium.

That was up from an earlier offtake for 80,000tpa.

“The expanded offtake arrangements remain conditional on (parties) agreeing and finalising the necessary variations to the mining services agreement to cover the production of the lower grade product, which will include the addition of a flotation plant at the Mt Marion Project,” Mineral Resources said.

“The variation will be concluded on completion of a detailed metallurgical test program currently being undertaken.”

Business News reported in May that the project was expected to begin commissioning in mid-2016.

Capital cost was expected to come in at $83 million.

Predictions for lithium demand growth in the next decade have been extremely bullish, underpinned by battery production for electric cars such as the Tesla.

As one example, international investment banking giant Goldman Sachs has predicted demand could triple by 2025.

Shares in Mineral Resources were up 3.4 per cent to $8.50, while Neometals was up 1 per cent to 48.5 cents each.

It comes two days after General Mining Corporation and Galaxy Resources announced a $216 million merger deal.

Both companies are involved in the Mt Cattlin lithium project, near Ravensthorpe.

Galaxy will buy General at a 9.4 per cent premium to the 10 day weighted average, about 65.2 cents per share.

Western Australia produces around a quarter of the world’s lithium supply, with the Talison Lithium Greenbushes mine producing 350,000t of products annually.