Mineral Resources to develop lithium processing hub
Mineral Resources (ASX: MIN) will acquire the Lake Johnston nickel concentrator plant and tenure and turn it into a lithium processing hub.
Owned by Poseidon Nickel (ASX: POS), Lake Johnston lies 185km southwest of Kalgoorlie in WA, covers an area of 86km2 and comprises of one exploration licence and 10 mining leases.
To acquire Lake Johnston, Mineral Resources will pay $1m upon execution of a binding heads of agreement with Poseidon, $6.5m on completion of the sale and purchase agreement and $7.4m 12 months post completion.
Lake Johnston has front—end capacity of 1.5mtpa and is capable of being converted to treat lithium ores, including dense media separation fines.
The asset is licenced to operate to 2041 and has an active groundwater extraction licence. On-site infrastructure includes an airstrip, 200-person camp, electrical infrastructure, workshops and laboratories.
Studies by Mineral Resources indicated repurposing a brownfields site would reduce the approvals timelines by two years compared to a greenfields development.
Mineral Resources managing director Chris Ellison says this is an exciting opportunity for the company.
“This is an exciting opportunity to develop MinRes’ third lithium processing hub in the Goldfields and the first to include flotation capacity to treat fines,” he said.
“We intend to bring our expertise in spodumene production to Lake Johnston, which has the potential to service projects throughout the world’s most prospective region for lithium.”
The transaction is conditional upon the completion of legal due diligence, the assignment of third-party agreements and consent for the transfer of all the rights and obligations for the tenements.
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