Lithium players lining up for Mineral Resources' Wodgina

Lithium players lining up for Mineral Resources' Wodgina

Tue, 01/05/2018 - 11:09

Mineral Resources is currently producing lithium direct shipping ore at its Wodgina operation in the Pilbara. Photo: Mineral Resources

Diversified mining group Mineral Resources says battery and automobile manufacturers and lithium processors have been lining up to buy into its Wodgina lithium project in Western Australia, as it launched a sales process for a 49 per cent stake in the operation.

The company announced to the ASX today that it would begin engaging with interested parties, after a series of unsolicited offers to take a direct investment in the project or to secure offtake rights.

Approaches came from lithium processing groups, battery and car manufacturers, as well as international commodities traders, Mineral Resources said.

Mineral Resources is currently mining direct shipping ore at Wodgina as it constructs a spodumene concentrate plant at the operation, which will produce around 760,000 tonnes annually.

A study into the feasibility of constructing a large-scale lithium hydroxide or lithium carbonate plant at Wodgina is also currently under way.

Investment bank Macquarie Capital and law firm Gilbert and Tobin have been appointed to assist with the sale, Mineral Resources said in a statement.

The Wodgina project produced about 1.16 million wet tonnes of lithium direct shipping ore (DSO) in the quarter that ended in March, accounting for a large portion of the company's overall production.

Managing director Chris Ellison said Mineral Resources would only introduce project partners if it can secure acceptable terms.

“MRL has the capability to finance and implement its downstream processing strategy at Wodgina on its own," Mr Ellison said.

Mr Ellison said the decision to sell an interest in Wodgina would allow the company to focus on its core business of mining services.

The company hopes to finalise a transaction by the second half of this year.