General Mining has entered a sales and distribution agreement with Mitsubishi Corporation for spodumene concentrate produced at the Mt Cattlin mine in Western Australia.
Under the four-year agreement, Mitsubishi will be allowed to sell up to 100% of spodumene concentrate produced from Mt Cattlin exclusively into the Chinese, South Korean, Taiwanese and Vietnamese markets where the demand for lithium is high.
Mitsubishi will serve as principal buyer for the spodumene concentrate and is expected to obtain the best selling price for all of the concentrate.
The two firms are also expected to consider opportunities in downstream processing.
Under the current mineral resource and ore reserve independent review estimates, Mt Cattlin project could deliver 11,500t annually of spodumene over an initial 17-year period of mine life.
In July 2012, Galaxy Mt Cattlin on care and maintenance because of delays with the ramp-up of its lithium processing facility in China. This plant was subsequently sold to Sichuan Tianqi Lithium Industries for $173.2m.
To restart the project, an estimated capital investment of A$14.7m ($10.6m) is required.
Mining News cited General Mining executive chairman Michael Fotios as saying: "This binding agreement with an international tier one trading house offers exclusive and unrivalled access in four priority markets where demand for battery grade spodumene concentrate is robust.
"Importantly, it marks another key milestone in our pathway to production at Mt Cattlin targeted for commencement in the first quarter of 2016."
General Mining recently completed the acquisition of a 50% stake in Mt Cattlin from Galaxy Resources.