The project is being executed by Covalent Lithium, an equally owned joint venture of Wesfarmers and SQM.
The Mt Holland lithium project involves the development of an open-pit lithium mine and a processing plant at Mt Holland and a refinery at Kwinana, Western Australia.
Wesfarmers said that the parties will commit to full funding for the project upon securing environmental approvals for the Kwinana refinery.
A lithium hydroxide refinery in Kwinana along with an open-pit lithium mine and a processing plant at Mt Holland will be developed under the project.
Subject to receipt of all the approvals, the partners plan to commence construction of the mine, concentrator, and refinery in the first half of FY2022.
The project is planned to commence the first production of lithium hydroxide in the second half of 2024.
Wesfarmers’ share of investment in project development is estimated at A$950m ($700m).
Wesfarmers managing director Rob Scott said: “The project capitalises on our Chemicals , Energy and Fertilisers divisions’ chemical processing expertise and Western Australia’s unique position to support growing global demand for electric vehicle battery materials which will make a crucial contribution to global efforts to reduce greenhouse gas emissions.
“We have been pleased with progress of discussions with key battery manufacturers, which reflect a positive outlook for battery quality sustainably sourced lithium hydroxide.”
In January, Wesfarmers said it deferred the FID for the Mt Holland project to allow for additional actions to be taken to improve its long-term value.
Following the decision, an updated definitive feasibility study (UDFS) was completed by Covalent Lithium highlighting greater certainty about the engineering design and capital and operating costs of the project.
The UDFS also provided increased scope for the production capacity of the concentrator and refinery from 45,000 tonnes per annum to nearly 50,000 tonnes per annum of battery grade lithium hydroxide.
Wesfarmers plans to start preliminary work to assess the expansion options at the project, along with the construction of the first phase.