China-based Ganfeng Lithium has agreed to purchase a 49% interest in China Minmetals-operated Yiliping lithium salt lake project in Qinghai Province, China, for $225m.
The transaction allows Ganfeng to gain its first salt lake asset in the country.
The Yiliping lithium salt lake project is located in Qaidam Basin in the province of Qinghai on the Tibetan Plateau.
Under the agreement, Jiangxi Ganfeng and its wholly owned subsidiary Qinghai Liangcheng Mining agreed to acquire a 100% stake in Ili Hongda Foundation Equity Investment Partnership.
Ili Hongda Foundation Equity Investment Partnership owns a 49% stake in Minmetals Salt Lake while the remaining 51% stake is owned by metals firm China Minmetals.
Minmetals will retain the mining rights for the Yiliping project. The transaction is subject to regulatory approvals.
Ganfeng was quoted by Reuters as saying that the acquisition “is conducive to the company’s business development, improves its core competitiveness and conforms to (its) upstream and downstream integration.”
The Yiliping project will use the salt lake’s brines to produce battery chemical lithium carbonate.
In addition to holding stakes in assets located in Australia, Mexico and Ireland, Ganfeng operates one spodumene mining project in China.
Last month, Ganfeng Lithium signed a new joint venture agreement with Bacanora Lithium for the Sonora Lithium Project in Mexico.
The agreement was signed after Ganfeng exercised its option to increase its stake to 50% in Sonora Lithium (SLL), the holding company of the lithium project.
Ganfeng will acquire the additional 27.5% stake in SLL by providing £21.8m funds to Bacanora Lithium. The funds will be channelled towards the development of the Sonora project in north-east Sonora.