US-based chemicals firm Albemarle has secured approval from the Foreign Investment Review Board (FIRB) in Australia to acquire a 60% stake in the Wodgina lithium project in Western Australia from the Australian mining services company Mineral Resources (MinRes).
In August 2019, Albemarle and MinRes have amended their previously announced $1.15bn (£950m) deal to create a joint venture for the Wodgina lithium mine in Australia.
The joint venture will be managed through a special purpose company to be owned by the two firms.
As per the amendments, Albemarle will increase its stake from 50% to 60% in the Wodgina hard rock lithium mine located in the Pilbara region.
MRL to receive $820m in cash
In exchange, MRL will receive $820m in cash as well as a stake of 40% each in two lithium hydroxide conversion units being built by Albemarle in Kemerton, Western Australia.
With a capacity of 25ktpa, each of the lithium hydroxide conversion units will be commissioned in stages beginning from the first half of 2021.
MRL will serve as the operator of the Wodgina lithium mine and battery-grade lithium hydroxide production facilities.
Commenting on the revised terms of the deal, Albemarle CEO Luke Kissam earlier said: “The ALB-MRL joint venture will generate great value by bringing together the mining expertise of MRL and the conversion process and market knowledge of Albemarle.
“The changes to the transaction accelerate the joint venture’s ability to bring lithium hydroxide to the market to serve the commitments made to Albemarle’s customers through our long term agreements.
“This also allows Albemarle to reduce its capital spend for the foreseeable future while preserving greater flexibility and options for any such capacity additions in the future.”
Upon completion and ramp-up of the spodumene concentration plant, the Wodgina Project is expected to produce nearly 100ktpa lithium carbonate equivalent (LCE).
The two companies will jointly fund, design, build and operate a battery-grade lithium hydroxide plant to be constructed at Wodgina in two stages of up to 50ktpa LCE each.
